Auto China
Car sales in China have collapsed by 92 per cent as the coronavirus shutdown wreaks havoc on the automotive industry. Image Credit: Wang chuan - Imaginechina

China's vehicle sales rose for a second straight month in May, an industry group estimated, signaling a recovery in the world's largest car market is gathering pace.

Wholesales of cars as well as commercial vehicles such as light trucks probably increased about 12% to 2.14 million units last month, China Association of Automobile Manufacturers said Tuesday. In the first five months of the year, deliveries to dealers fell 23% to 7.9 million units, the trade body said in a statement, without giving further details.

The report adds to evidence that a two-year slump is easing, helped by rising demand for commercial vehicles as China restarts its economy following the coronavirus pandemic. Optimism is growing that the world's largest auto market is on the mend as the government rolls out incentive measures to spur consumption.

Yet a complete recovery is far from certain, given sales were waning already before the virus broke out and shuttered car plants and dealerships. A slowing economy, tougher emission standards and rising popularity of ride-sharing services are weighing on demand.