An array of cities in China have recently jumped on the bandwagon by introducing new measures to stimulate domestic consumption of automobiles, which has been whittled away by the coronavirus.

According to a WeChat post by East China's Zhejiang Province on Tuesday, Hangzhou, the provincial capital city, is being encouraged to lift restrictions on vehicle purchases in an orderly way, while the rural market should also be explored to release its potential.

Separately, on March 20, the municipal government of Guangzhou, capital of South China's Guangdong Province, passed a bill to introduce more practical policies to boost local auto consumption including providing an increase in new-energy vehicle (NEV) sales, encouraging a faster move on vehicle replacement and upgrading, and creating a sound environment for auto spending.

The government estimated that those policies would see a total output value of more than 20 billion yuan ($2.82 billion).

Following the Guangzhou move, Changsha, capital of Central China's Hunan Province, has also brought in measures to subsidize new car purchases amid the anti-coronavirus fight.

From March 11 to June 30, consumers who buy from designated dealers and get license plates in Changsha will enjoy a subsidy of 3 percent of a vehicle's price, which could add up to 3,000 yuan per car, according to the city government's development and reform commission.

"It is expected that more cities, including first-tier cities like Beijing, will soon put forward their policies such as loosening purchasing restrictions to drive local auto sales, a move to revive the industry and recover market confidence," Cui Dongshu, secretary-general of the China Passenger Car Association (CPCA), told the Global Times.

China's auto board saw shares up 2.87 percent by Tuesday's close.

China's passenger vehicle sales dropped sharply in February due to the severe impact caused by the novel coronavirus outbreak, plunging 78.5 percent compared with a year earlier to 252,000 units in the month, data from CPCA showed.

Sales of NEVs shrank 77.7 percent year-on-year last month and fell 70 percent over January.

The big contraction in car sales came after an overall enforced suspension of sales activities to curb the spread of the coronavirus, as well as a lower demand to buy new cars caused by the suspension of license plate application, according to CPCA.

It is likely that there will be large-scale loosening of restrictions on purchases and license plates in the future, which will be a key factor in triggering car sales to bounce back in the short-term, according to a report by Ways, a provider of data-driven business analysis for China's automotive industry.

The firm has forecasted that China's passenger car sales would drop by 10 percent in 2020 on a yearly basis with February hitting the lowest point.

Ye Shengji, vice general-secretary of the China Association of Automobile Manufacturers, said the epidemic's impact would mainly be reflected in first-quarter operations, the period of which is estimated to see a 45 percent drop in auto sales if the epidemic can be effectively controlled by the end of March.

"Restrained consumption demand is expected when the virus subsides, and the auto market would embrace a temporary sales peak, but considering some consumers' salary cuts during the epidemic outbreak, the full year's performance is not that optimistic," said Ye.

Vehicle sales in China, the world's largest auto market, fell in 2018 for the first time in 20 years.