Volkswagen Group suffers it's first decline in China sales for TEN YEARS, Porsche was the only saviour.

Volkswagen Group's China sales fell nearly 17 percent year on year to 250,000 vehicles in June as the country's slowing economy continued to hamper foreign mass-market brands. It also marked the first time in 10 years that the company's China sales fell in the first half of a year.

In June, VW brand deliveries plunged nearly 22 percent, Audi volume declined 5.8 percent and Skoda sales decreased 15 percent. Porsche was a bright spot, with sales up 71 percent.

In the first six months, Volkswagen Group sold 1.74 million vehicles in China, a decline of 3.9 percent from a year earlier. First-half sales in China last fell in 2005, when deliveries slumped 14 percent.

Auto sales have slowed this year in China after economic growth moderated, more cities capped the number of new vehicles, and a volatile stock market diverted funds from auto purchases. Demand has slowed for VW and other carmakers in China despite increasing discounts and financial assistance to distributors.

The VW brand is also suffering from a lineup of mostly older SUVs and crossovers that now compete with lower-priced competitors from Chinese automakers.

While VW's decline in China reflects the weaker market, the carmaker has also been slow to adapt to changing tastes, said Robin Zhu, an analyst at Sanford C. Bernstein & Co.

"VW has problems of its own," said Zhu, who is based in Hong Kong. "The brand in particular is a very sedan-centric fleet in an environment where there is this big switch to sport utility vehicles."

To revive sales over the long term, Volkswagen plans to launch a line of low-priced vehicles -- including a sedan, SUV and hatchback -- in China in 2018.

The vehicles, to be built in China, will be priced from 8,000 to 11,000 euros (53,800 to 74,000 yuan).

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