China's auto industry reported its sharpest sales increase in almost a year in October, according to a report from the China Association of Automobile Manufacturers (CAAM).

Sales for the month of October increased by more than 13% compared to October of last year, and by nearly 11% since September, with more than 1.9 million passenger cars sold.

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The rise in sales follows three straight months of decline in June, July and August, when sales fell 3.4%, 6.6%, and 3.4% respectively compared to the same months the previous year.

Auto sales in China began to rebound slightly in September, which saw 2.1% growth in car sales from September of 2014.

"The government incentive program has been effective," said Dong Yang, executive vice president of the CAAM at a press conference in Beijing. He said a tax cut by the central government for smaller cars helped spur the increased demand.

The purchase tax was halved to 5% for cars with engines smaller than 1.6 liters. S,all cars account for more than 60% of China's car market, according to the Wall Street Journal.

In April, China's Ministry of Finance said that buyers would be offered subsidies worth between 31,500 yuan ($5,000) and 54,000 yuan ($8,500) per car for purchases of new-energy vehicles (NEVs).

China's provincial governments have also introduced incentives for people to buy NEVs. Beijing has eased restrictions on license plates for NEVs, and announced last month that those buying NEVs could bypass the normal lottery system for obtaining a license plate.

With the help of these initiatives, sales of NEVs soared by more than 500% in October to 34,000, compared to October 2014, according to CAAM.

In addition to the government incentives, Dong also attributed the rise in sales to improving economic conditions, and the relatively low rate of car ownership in the country. 

TagsChinese Auto Sales Show Strong Growth, the China Association of Automobile Manufacturers, CAAM, Dong Yang