China Association of Automobile Manufacturers (CAAM) said Thursday that sales of domestic cars in China set a new record of 1.11 million units in March, up to 5 percent from last year.

According to Autodata Corp statistics, US new vehicle sales tumbled 36.8 percent to 857,735 in March from the same month last year. China’s March auto sales recorded an increase of 34 percent from February, when sales rose 24.7 percent year-on-year to 827,600 units. This was the third consecutive month that China’s auto sales exceeded the United States, the world’s largest auto market.

Sales of passenger cars — sedans, SUVs and MPVs — increased 27.2 percent month-on-month and 10.3 percent year-on-year to 772,400 last month. Sales of passenger cars with engines of 1.6 liters or less rose 21.9 percent to 1.41 million in the first three months, or 70.7 percent of the total passenger car sales. Sales of commercial vehicles — buses, trucks and pick-ups — rose 53.2 percent month-on-month to 337,400, but fell 5.3 percent from a year earlier. Automakers produced 1.1 million vehicles last month, up 5.55 percent year-on-year, according to the CAAM.

The association said sales were buoyed by government stimulus policies. On January 20, China halved the purchase tax on passenger cars to 5 percent for models with engine displacements of less than 1.6 liters. so that is good news for China manufacturer.