Manufacturers' sales of domestically-made autos slowed in China in July as inventory levels rebounded, the China Association of Automobile Manufacturers (CAAM) said Monday.

Domestic manufacturers' July sales to auto dealers fell 11.9 percent from June to 1.244 million units while output dropped 7.54 percent month on month to 1.286 million units, the CAAM data showed.

Manufacturers' inventory had risen to 549,100 units by the end of July, up 44,400 units from the end of June, after inventory fell in the previous two months.

The July figure took domestic manufacturers' auto sales to dealers in the January-July period to 10.26 million units, a 42.65 percent year-on-year increase, a figure boosted by last year's low comparison base, according to CAAM.

Domestic manufacturers' auto production jumped 43.64 percent year on year to 10.21 million units in the first seven months, the CAAM data also showed.

Dong Yang, executive vice president and secretary general of CAAM, noted July and August are traditionally weak periods for manufacturers' sales and that the July slowdown was within market expectations.

"Output and sales of domestically-made cars are returning to their normal levels of growth. This is good for the sustainable development of China's auto industry," Dong said.

Based on the January-July figures, Dong estimated production and sales of domestically-made autos may both surpass 16 million vehicles this year, an upward revision from his previous estimate made in June of 15 million units.

He added such figures will mean China will retain its position as the world's largest auto market.

As for auto inventories, Dong said they remain at a normal level of around one and a half months of sales.

According to the CAAM data, SAIC Motor, Dongfeng Motor Corporation and First Automobile Works were the top three manufacturers in terms of sales in July.