New vehicle sales in China returned to growth in March, with deliveries to dealers rising by 4.7% to 2.66m units from 2.54m units a year earlier, according to data released by the China Association of Automobile Manufacturers (CAAM).

Sales in February fell by over 11%, largely due to the timing of this year's Lunar New Year holidays - the country's main annual holiday when hundreds of millions of Chinese return to their hometowns for a week.

Sales of new energy vehicles, mainly comprising electric and hybrid vehicles, jumped by over 117% year on year to 68,000 units last month.

In a separate report, the China Passenger Car Association said passenger vehicle sales increased by 3.3% to 2.02m units in March from a year ago.

First quarter sales increased by 2.8% to close to 7.2m vehicles from just over 7m units in the same period of last year – in line with the association's forecast of 3% growth for the whole of 2018.

The market could be lifted further if the Chinese government moves ahead with plans to cut import tariffs on vehicles from the current 25%.

General Motors and its joint ventures reported a 2% year on year sales rise to 352,346 units in March, while Nissan's sales increased by 2.4% to 122,959 units and Toyota's were up by 5.4% at 118,500 units.

Honda's sales fell by 13% to 97,587 units in March with the brand hindered by engine problems which forced it to temporarily suspend sales of CRV and Civic models produced at its Dongfeng Honda Automobile joint venture last month.