The China Association of Automobile Manufacturers (CAAM) reported that total vehicle sales grew by a mere 0.2% in the year to January - the slowest since February last year. This compares with annual growth rates of 9.5% in December and 16.6 in November.
As expected, the removal of the government's incentive on small vehicles - halving the 10% purchase tax on vehicles with 1.6-litre engines or smaller - on 31 December 2016 put the brakes on vehicle sales in the country.
Despite softening the blow - Beijing announced last 15 December that small car buyers would still receive a 25% sales tax incentive this year, taking the statutory rate to 7.5% before it returns to its full rate of 10% on 1 January 2018 - vehicle sales slowed abruptly.
CAAM expects vehicle sales growth of 5% this year, down from 13.7% for all of 2016.