Car sales in China rose 8.8% in September compared to the same month a year earlier to 1.32m units according to data from the China Association of Automobile Manufacturers (CAAM).

CAAM added that the mild rebound from May, when monthly car sales declined for the first time in more than two years, would extend through the fourth quarter as year-end promotions are likely to lure customers to showrooms.

September's growth picked up from 7.3% in August, when sales totalled 1.1m.

After two years of massive expansion, China's auto market is returning to a more subdued growth pattern. The cooling has been attributed to the termination of government tax incentives and local government initiatives aimed at easing ever-worsening traffic congestion.

Some cars are still eligible for the rebates, but only if they burn 6.3 litres of fuel per 100kms, fewer than the previous bar of 6.9 litres.

This, some observers say, is expected to hit local car makers more than overseas players which have superior fuel-saving technologies.