Chinese cars can attract Vietnamese customers because they cleverly imitate European, Japanese and American luxury models in appearance, while the selling prices are very reasonable.
The General Department of Customs (GDC) reported that Vietnam imported 4,918 cars in April 2020, a decrease of 60 percent in quantity and 40 percent in value compared with the month before. However, imports from China increased sharply.
China exported 424 CBU cars to Vietnam in April, the third largest car exporter to Vietnam, just after Thailand and Indonesia. As for specialized vehicles, Vietnam imported 301 products during the same time, which accounted for 50 percent of total imported specialized vehicles.
According to car dealers, after the illegal ‘cow’s tongue line’ was discovered on the map of Volkswagen Touareg’s screen in October 2019, cars with less than 9 seats from China did not arrive in Vietnam for many months.
However, Chinese cars have returned to Vietnam in recent months, when inspection regulations were loosened. Instead of examining quality of imported CBU cars in lots, customs agencies now only exam representative samples.
|Chinese cars have returned to Vietnam in recent months, when inspection regulations were loosened. Instead of examining quality of imported CBU cars in lots, customs agencies now only exam representative samples.|
The car dealers now plan to import Chinese cars in large quantities.
An analyst predicted that the Vietnamese market would be flooded with Chinese cars, saying that not only Chinese CBU imports would come, but Chinese cars would also be assembled in Vietnam.
Tan Chong Motor has invested in an automobile factory in Vietnam which wi specialize in assembling cars, trucks and buses with MG brand, under the management of SAIC Motor Group.
Sources said that two models would be launched into the market this year, namely MG HS and MG ZS, which would compete directly with Honda CR-V, Mazda CX-5, Hyundai Tucson, Ford EcoSport, Hyundai Kona and Honda HR-V.
The Dong Feng Group is also considering making an investment in an automobile manufacturing project in Vietnam.
Chinese CBU cars now bear relatively high tariffs of 40-70 percent. However, their selling prices are still 50 percent lower than Japanese and South Korean cars of the same kinds. If the models are assembled in Vietnam, their prices would be 20-30 percent lower.
Nguyen Thanh Tung, a car dealer in Tan Binh district, HCM City, said that Chinese cars can be sold, though they don’t have strong brands, thanks to theur reasonable prices and attractive appearance. Their quality has also improved significantly.
Most Chinese cars have designs relatively similar to some luxury models such as Ranger Rover, Lexus, BMW, Audi and Land Rover.
The Chinese Baic BJ40 SUV, for example, listed as a luxury model, and priced at VND900 million, is designed with the style of Mercedes-Benz G-Class.
The sales of automobile surged 62 percent month-on-month in May following the end of social distancing measures, according to the Vietnam Automobile Manufacturers’ Association (VAMA).
Car sales dropped sharply by 40 percent in Q1 2020 as several industries cannot reach agreement on solutions to develop the automobile industry.