The Chinese vehicle market surprised analysts with a 26.1% growth rate (to 2.56m units) in September, although the outlook is clouded by the planned expiry of a tax incentive for car purchase.

September was the fifth straight month of double-digit acceleration in vehicle sales. The market is some 13.1% ahead of last year in the first nine month of the year. However, analysts say the market is enjoying some pull-forward of purchases ahead of the expiry of a tax break (introduced to shore up car demand in the face of China's economic slowdown).

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Deliveries of passenger vehicles saw a 29% year-on-year surge to 2.27m sales in September.

The China Association of Automobile Manufacturers (CAAM) has warned of a steep drop in growth if a tax cut on small engine cars is allowed to expire – as planned – in December. The trade association also revised its forecast for vehicle market growth this year to 7% (was 6%). It also said that the end of the tax break could mean that the market sees a maximum of 2% growth in 2017.

CAAM association Vice-Secretary Shi Jianhua told reporters that retaining the tax cut would result in growth to the vehicle market of 6-7% next year.

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"If the tax cut policy is not extended, this year there may be a rush to buy, it will subtract from next year's sales," Shi told Reuters.

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SUV sales grew at 46% in September and SUVs delivered by domestic carmakers for the first nine months of the year were up by more than half to 3.37m.

Just 44,000 new energy vehicles were delivered to the country's dealers in September, a much slower rate of sales than recent months. Analysts say a crackdown on subsidies fraud by the government is responsible for the slowdown in the segment.