(Yicai Global) Sept. 27 -- Profits at China’s auto manufacturers doubled last month from the same period last year, even as profits at Chinese industrial firms continue to slide, albeit at a slower rate than in July, according to the latest data.

Industrial profits, which refers to profits generated by industrial companies with an annual revenue of over CNY20 million (USD2.8 million), tumbled 2.1 percent in the first eight months from a year earlier to CNY5.5 trillion (USD767.9 billion), according to data released by the National Bureau of Statistics today.

Profitability, though, improved in 27 out of 41 industrial sectors in August, said Zhu Hong, a senior NBS statistician. And most of them are among the downstream sectors

Carmakers saw profit grow at the fastest pace in a year last month, driven by supportive policies that help spur vehicle purchases. The electricity sector also did well, with profits soaring two-and-a-half times, as high temperatures led to a big jump in power usage. And the electrical machinery industry logged a 36.7 percent surge in profit, boosted by growing demand for electric car batteries, solar products and air conditioners.

Micro, small and medium-sized firms, which rely on low costs to stay competitive, are still being squeezed by upstream suppliers even though the price hikes are getting smaller, Bruce Pang, chief economist and head of research for Jones Lang LaSalle China, told Yicai Global. This shows that market entities still face difficulties and are desperately in need of powerful policy support.

In future, policies should put more emphasis on boosting demand in the domestic market, rather than just focusing on short-term economic stimulation, Pang said. Monetary policy should assist fiscal and industrial policies, focusing on stimulating demand through consumption and investment.

The added-value among industrial firms above a designated size grew 4.2 percent last month year on year, 0.4 percentage point more than in July, the NBS said earlier.

Editors: Dou Shicong, Kim Taylor