It was the fifth straight month that sales growth has declined. Growth was at double-digit monthly rates early this year.
China is the world's second-largest auto market after the United States, and global automakers are counting on it to drive revenues as sales elsewhere slump. But analysts say high oil prices are prompting Chinese drivers to postpone purchases and have lowered sales forecasts for this year.
Total sales of sedans, sport utility vehicles and light trucks in July was 488,200 units, the CAAM said. It said 360,800 sedans were sold.
In a move to curb rising gasoline consumption, the government this week doubled sales taxes on the biggest cars from 20 percent to 40 percent while cutting taxes on smaller cars.
This month, auto consulting company J.D. Power and Associates cut its forecast for China's 2008 auto sales to 5.95 million, down from 6.2 million units earlier.