CHINA'S passenger car sales rose 23 percent last month from a year earlier, the fastest pace since January, fueled by auto buyers who were flush with profits from the stock market.

Sales of passenger vehicles, including cars, multi-purpose vehicles and sport-utility vehicles, rose to 488,500 units in May, according to a report yesterday from China Association of Automobile Manufacturers.

Over the first five months, passenger car sales reached 2.57 million units, an increase of 21 percent from a year earlier, Beijing-based CAAM said.

The growth outpaced the association's forecast of 15 percent for China's entire vehicle market this year.

"Many retail investors sold their holdings and used their profits to buy cars in May before the government employs more measures to cool the soaring stock market," said Rao Da, secretary for the National Union of Passenger Car Market and Information.

"Also, the price cuts and the launch of price-competitive models helped to boost sales," Rao told Shanghai Daily.

May's sales pick-up was powered by the car segment, which grew 23.1 percent to 368,000 units during the period. Chinese car makers also sold 15,900 MPVs and 28,000 SUVs in addition to 76,600 mini buses.

Top-ten car makers including FAW-Volkswagen Automobile Co Ltd, Chery Automobile Co Ltd and Shanghai Volkswagen Co Ltd sold a combined 236,600 units in May, accounting for 64.3 percent of the total.

Shanghai General Motors Co Ltd, Dongfeng Nissan Motor Co Ltd, Geely Automobile Co Ltd, Guangzhou Honda, Dongfeng Peugeot Citroen, FAW-Toyota and Tianjin FAW Automobile ranked from fourth to 10th.

Chinese-branded models continued to hold nearly a 30 percent market share in the car segment during the January-to-May period with 559,300 units.

Chery Automobile Co Ltd's QQ subcompact, FAW-Xiali's Xiali, FAW-Haima's Family, Cowin from Zhejiang Geely Automobile Co Ltd and BYD Corp's F3 sedan sold a combined 263,900 units.