Car registration plate prices fell sharply this month, reflecting lower auto sales in Shanghai.

Both successful bids and overall bidding prices dropped in September, figures released yesterday by the Shanghai International Commodity Auction indicated.

The average price of successful bids dropped to 31,788 yuan, 4,672 yuan down on August prices.

The lowest bidding price dropped to 29,300 yuan, 6,600 yuan lower than August.

It was the second lowest bid of the year, well ahead of an 8,100 yuan bid in January when a new auction system was implemented.

The government increased the number of plates for sale to 6,500 in September, however, the number of bidders dropped 22 percent to 11,002.

Market demand usually increases in September as new car owners want to drive their vehicles during the National Day holiday.

The higher prices in August led some buyers to pay over 38,000 yuan on the second-hand market to avoid price escalation at auction.

Analysts said the unexpected price drop was a result of fewer car sales despite the prime selling season.

They said people are more cautious with their money now after hearing about global financial crisis, and hesitate in buying big-budget durables such as cars.

China's auto sales posted their first year-on-year drop in August. China Association of Automobile Manufacturers said sales fell 6.34 percent to 629,000 units.

Passenger car sales fell 6.24 percent to 451,300 units while commercial vehicle sales fell 6.59 percent to 177,700 units.