VietNamNet Bridge - Imports of Chinese trucks are affecting domestic auto manufacturers and causing losses to the state budget, according to the Vietnam Association of Mechanical Industry (VAMI).

According to the latest statistics from the General Administration of Customs, in the January-April period of 2015, 8,860 cars, mainly trucks, were imported from China, up by 289% year on year.

China has overtaken South Korea to become Vietnam’s largest importer of finished cars.

In April alone, over 3,470 cars were imported from China, with a turnover of $135.4 million, accounting for more than 1/3 of the total auto imports.

Ranking behind China in the January-April period are Korea, with 7,740 cars, up 48%; Thailand 6,850 cars, up 165%; India 5,700 cars, up 164%; and Japan 2,290 cars, up 120%.

According to VAMI, imports of Chinese cars rose recently because the Ministry of Transport tightened control over overloaded trucks, and this resulted in a high demand for trucks.

Moreover, the prices of Chinese cars are cheap, equivalent to about 2/3 of the prices of cars imported from ASEAN and Europe.

Earlier, in a document to the Prime Minister and the Ministry of Finance, VAMI pointed about the impact on local truck manufacturers and losses to the state budget caused by imports of finished cars, particularly Chinese cars.

Bui Ngoc Huyen, chairman of Xuan Kien Automobile JSC (Vinaxuki). said domestic automobile manufacturing enterprises will die off when heavy trucks imported from China enjoy import tax rate of zero percent.

However, economist Bui Trinh said domestic firms currently only assemble cars. "If cars imported from China are cheaper, it is a good choice for consumers," he said.

He explained that by mid-March, imports of cars with nine seats and under accounted for over 50 percent, and the remaining were trucks. Thus, most of the cars imported are for production and it proves that the volume of goods for transport has increased, which is a good sign for the economy.

Minh Hai