Xi'an signals cap on car purchases

The northwest metropolis of Xi'an may become the fifth city in China to impose restrictions on car purchases to improve traffic congestion.

A draft proposing to control the number of motor vehicles in the capital city of northwestern Shaanxi province will be released for public opinion in August, according to China Business News.

No specific details on the car purchase restrictions have been released, but the draft shows the municipal government's clear intention to clamp down on more vehicles.

The decision follows a report on traffic congestion issued by the government in early July, which said the number of private cars should not exceed one million during the 12th Five-Year plan (2011-15). Certain groups and public bodies will reportedly be barred from buying new vehicles for three years.

Xi'an has 1.19 million registered cars, ranking 10th highest in the country.

"The limitation policy would be a major blow to medium and low level car brands," Cui Dongshu, vice secretary general of China Passenger Car Association, told the paper.

Xi'an will be the fifth city on the Chinese mainland to limit car purchases after Beijing, Shanghai, Guangzhou athind Guiyang.