Vietnam's automobile industry needs support from government

VAMA (Vietnam Automobile Manufacturers’ Association) reported that 28,899 products were sold in October, an increase of 21 percent over the month before, and 18 percent over October 2017. 

October witnessed a sales boom of favorite brands such as KIA (2,657 cars), Honda (3,475) and Toyota (8,426). Vios, Wigo, Fortuner and Innova models of Toyota were among the 10 bestsellers.

Ford Vietnam had sales in October that were 12 percent higher than the same period last year. Its Ford EcoSports, with sales up by 59 percent, continued to be the bestseller in the small-size SUV market segment.

As such, 214,466 products have been sold by VAMA’s members this year. Mazda’s products sold the best with 26,165 products, followed by KIA (23,310) and Honda (21,054).

Imports are selling well in the last months of the year. The strict requirements stipulated in Decree 116 blocked car imports to Vietnam, but the situation has improved.

Commenting about Vietnam’s automobile market in the long term, Mercedes Benz Vietnam’s CEO Choi Duk Jun said it would follow Chinese or South Korean markets. As families have few children and are used to purchase by instalments, the buyers tend to be younger and more willing to spend money on cars.

Toru Kinoshita, chair of VAMA, said with the strong development of the national economy, Vietnam will see rapid growth in the personal car market segment.

Nguyen Ngoc Thanh, deputy director of the Industry Agency of the Ministry of Industry and Trade (MOIT), said Vietnam has set up policies that show its strong determination to develop automobile industry.

In 2014, the Prime Minister approved the automobile industry development strategy by 2025. In 2016, regulation on policies to implement the strategy got approval.

Most recently, in late 2017, the government released a decree on the conditions for manufacturing, assembling, importing and providing maintenance services. The decree shows Vietnam’s view that the auto industry is an important driving force for industrialization and modernization, with stable, consistent and long-term policies.

Many well-known brands are present in Vietnam, such as Toyota, Ford, Honda and Mitsubishi, as well as Vietnamese brands like Thaco and VinFast.

A report found that the localization ratios are 55 percent for trucks, and 45-55 percent for passenger cars with 24 seats and more.

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