return icon Vietnamnet.vn

Vietnamese crazy about cars, manufacturers rush to sell

VietNamNet Bridge - Foreign investors can see great auto sales opportunities in the Vietnamese market. Billions of dollars have been spent to develop car distribution networks instead of manufacturing.
VietNamNet Bridge - Foreign investors can see great auto sales opportunities in the Vietnamese market. Billions of dollars have been spent to develop car distribution networks instead of manufacturing.

{keywords}

Car trading in 2016 saw the number of projects in the sector increasing sharply. About 505 projects in the field were licensed, ranking second in terms of foreign direct investment (FDI), just after real estate, according to the Ministry of Planning and Investment (MPI).

The representative of a foreign-invested automobile manufacturer said previously, FDI capital flowed into production and assembling, but now, it pours into retail and post-sale services.

He said foreign investors all can see great potential in Vietnam, where the demand has been increasing rapidly. There is a big wave of foreign investors coming to Vietnam to work as distribution agents for manufacturers.

Sources said some auto manufacturers have finalized the list of distributors for the years from now to 2023, i.e that from 2017, they will only consider appointing distributors for the years from 2024.

Foreign investors can see great auto sales opportunities in the Vietnamese market. Billions of dollars have been spent to develop car distribution networks instead of manufacturing.

From January 1, 2018, the tariff on the imports form ASEAN will be cut down to zero percent. Under free trade agreements, the tariffs on CBU (complete built unit) imports will also be decreasing step by step. By 2026, nearly all the tariffs will be lowered to zero percent before Vietnam fully opens its market by 2029.

About 30 leading brands are present in Vietnam. However, most of them still don’t have large distribution networks. The biggest brand has 40 sales agents throughout the country. The Central Highlands and the western part of the southern region –  potential market areas – still have not been exploited.

Automobile manufacturers understand that expanding distribution networks is the best solution to improve revenue. Therefore, they applaud the FIEs joining the distribution market.

Mercedes Benz, Audi, BMW, Toyota, Honda, Mazda, Ford, Hyundai, Kia and Mitsubishi  have opened a series of authorized distribution agents recently.

It is expected that by 2029, Vietnam market scale would be about 1 million brand-new cars a year with revenue of $12 billion.

Vietnam is among the fastest growing markets in the region. Over 300,000 cars were sold in 2016, an increase of 24 percent over 2015. Experts have predicted the growth rate would be 20 percent in 2017 thanks to the tax cut and lower car prices.

An analyst said there were clear opportunities to make money from selling cars as import tariff cuts would make cars cheaper and more affordable to Vietnamese.

related news

Tran Thuy

MORE NEWS

EuroCham Chairman praises strong and forward-looking government

Vietnam’s recovery has been ensured by strong and forward-looking government support which helped to bring in more high-profile FDI projects

Many firms suspend raising capital from stock market

Many enterprises have either stopped mobilizing capital or changed their capital-raising plans on the stock market amid existing uncertainties and disadvantages.

HCM City runs out of Covid-19 vaccines

HCM City has run out of Covid-19 vaccines over the past 10 days, said Nguyen Hong Tam, the deputy director of the municipal Centre for Disease Control and Prevention.

VIETNAM NEWS HEADLINES SEPTEMBER 30

Chinese police hand over wanted man to Lao Cai authorities

Foreign-invested enterprises face up to procedural barriers

Administrative procedures such as a prolonged timeline for obtaining business licences, as well as overlaps in the legal framework, are continuing to affect the expansion plans of many foreign-invested enterprises in Vietnam.

Reisereporter.de: Vietnam among ten attractive destinations to escape Europe’s winter

With its year-round warm tropical climate, breathtakingly beautiful scenery, and exciting culture, Vietnam is gradually becoming an attractive destination for German tourists.

VIETNAM BUSINESS NEWS SEPTEMBER 30

Real estate sector faces debt default risk

Shan Tuyet tea, valuable timber plants named ‘Vietnam Heritage Trees’

More than 1,300 Shan Tuyet tea plants in Ha Giang province and a group of valuable timber trees in Dak Nong province have been recognised as “Vietnam Heritage Trees”.

Fast fashion brands scale up for growth

Surviving and developing in a competitive fast fashion market remains a challenge for many brands, especially for newcomers.

Arguments arise as properties required to be traded on exchange

Controversy has arisen over the Ministry of Construction’s draft of the amended law on real estate trading as it requires real estate products to be traded on an official exchange.

Boeing accelerates cooperation with Vietnamese suppliers

Boeing, the world’s leading aerospace company based in the US, are accelerating cooperation with Vietnamese suppliers and universities to provide a foundation for long-term industrial growth.

Expecting coffee exports to hit a record $4 billion

Vietnam Coffee Cocoa Association (Vicofa) forecasted that if the export price of coffee remained at a high level, as in the first half of the year

Major investors worry as stock market weakens

The stock market boards have been covered with red amid investors’ rising caution. There are few buyers, while selling pressure still exists. Foreign investors’ behavior has affected the market.

Vietnam sees great potential in ASEAN halal market

Despite opportunities available in the ASEAN halal food market, Vietnamese exporters have to date exported only a small amount of halal products to some countries in the region.

Vietnam is becoming a beacon in the region: The Brussels Times

The Brussels Times of Belgium has run an article highlighting that Vietnam is becoming a beacon in the region with the capacity to control inflation and maintain economic growth at a high level despite turbulent international affairs.
back_to_top