However, millions of new cars hitting the road each year also contributed to air pollution in a country where fuel quality needs to be improved.

The State Council, or China's cabinet, on Wednesday announced a stricter standard for auto fuel will be promoted nationwide before 2017.

The move will help accelerate the enhancing of auto emission standards and reshuffle the industry by forcing out small producers that are technically and financially unprepared for the upgrading, said Cao He, an auto analyst with China Minzu Securities.

It will also drive fuel prices up and boost the market for fuel-saving and new energy cars, according to Cao.

China overtook the United States to become the world's largest auto maker and auto market in 2009.

The country's foreign trade in automobiles and parts and components rose 6.71 percent in 2012 from a year earlier to 152.67 billion U.S. dollars, slowing by 25.12 percentage points compared with 2011, the CAAM said Thursday, citing its compilation of customs figures.

Some 1.13 million vehicles were imported in 2012, with that figure up 9 percent year on year, but the growth rate down 18.69 percentage points from 2011.

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