About 177,500 sedans were sold in China in May, 42,600 less than April, or a reduction of 19.35 percent, according to the China Association of Automotive Manufacturers (CAAM).

In the first five months this year, about 964,700 sedans were sold, said the CAAM in Thursday's Beijing News.

The car sales in April had dropped by 2.72 percent from March when the sale of all kinds of vehicles had hit a record high 542,600 in China.

The National Statistics Bureau (NSB) said on Tuesday that China produced 215,100 cars in May, 24,400 less than April and the growing storage of cars since the start of this year led to a 10-plus percent decrease in sedan production.

The NSB also said that more than 80,000 cars were stored away during the first quarter of this year, and 23,000 more cars went to the storehouses in April.

The Beijing News said Japan's Honda reported a monthly sales drop of 16 percent from April to May.

Insiders said the dramatic drop of sedan price since the beginning of this year did not encourage buying but made more potential car buyers decide to wait for the price to drop even further.

German auto giant Volkswagen announced Wednesday a price cut of its sedan models. The company cut the price of its popular compact car Polo by 10,000 yuan while Passat reduced 5,000 to 10,000 yuan.

Some analysts also noted that the banks are guarded in car loaning business which might also have unfavorable impact on private car buying.

Source: Xinhua