return icon

When will the Vietnamese automobile dream come true?

Vietnam still has to import car parts for domestic assembling. As a result, the production cost is high and domestically made products remain less competitive than imports.

At the Vietnam Business Forum (VBF) which took place in late 2019, the working group about automobiles and motorbikes pointed out that Vietnam’s automobile industry is slowly developing because of low output, weak high-quality material industry and limited management capability.



According to the working group, Vietnam’s car parts are three times more expensive than Thailand’s. Domestic manufacturers, for example, quote a price of nearly $4 for each product. The 200-300 percent price gap is also seen for plastic components, which is even higher than high-quality components.

The mass car imports have caused difficulties for domestic production. Automobile joint ventures have ceased assembling many models in Vietnam and import products instead. This is one of the reasons behind the weak supporting industries.

The mass car imports have caused difficulties for domestic production. Automobile joint ventures have ceased assembling many models in Vietnam and import products instead. This is one of the reasons behind the weak supporting industries.

Meanwhile, experts pointed out that if supporting industries cannot develop, Vietnam’s automobile industry will just do simple assembling forever.

According to Toyota Vietnam’s general director Toru Kinoshita, the high output and large market are the most important factor to persuade automobile manufacturers and suppliers to increase the localization ratios.

Japanese Enkei came to Vietnam in 2007 and became the car part supplier of Toyota, Truong Hai, Honda, Nissan and Mitsubishi. Its major product is casting rim and it only makes 24,000 products a month.

Meanwhile, the company needs to have orders for 100,000 products a month to optimize production. With current small orders, each product has a production cost 5-10 percent higher than other regional countries.

In its report about the implementation of the plan to develop the automobile industry released in 2019, the Ministry of Industry and Trade (MOIT) admitted that Vietnam failed to meet the goals set for the automobile industry.

Vietnam wanted to have the localization ratio of 60 percent of cars with nine seats or less, while the real ratio is 7-10 percent only.

Vietnamese enterprises can only make very simple car parts, such as tyre, glass, battery and plastic products. At least 80-90 percent of major materials for making components, such as alloy steel, aluminum alloy, plastic particles and technical rubber, must be imported.

Tran Huu Nhan from the HCM City University of Science andTechnology, commented that Vietnam is still doing the welding, painting, assembling and testing, i.e. the world’s technologies of 1940s, 1950s. The biggest problem for Vietnam’s automobile is the limited demand.

Meanwhile, Nguyen Khac Trai, former lecturer of the Hanoi University of Science and Technology, said in the current conditions of Vietnam, it will not have an automobile industry of its own.

“I think Vietnam needs 20 more years,” he said. 

Tran Thuy

Govt’s new decree removes barriers to automobile imports

Govt’s new decree removes barriers to automobile imports

Automobile importers in Vietnam will no longer have to obtain a Vehicle Type Approval (VTA) certificate from authorities in exporting countries, making it easier for them to import cars into the country.  

Vietnamese automobile makers ask for more support

Vietnamese automobile makers ask for more support

Among the incentives, the government is urged to lower the special consumption tax for locally made parts to help them reduce prices to compete with foreign manufacturers.



Strong economic growth creates platform for M&A market


Hanoi Tourism Ao Dai Festival 2022 opens

Use of e-cigarettes by youth rockets with easy availability at shops

Many students and young people have been hospitalized in a deep coma after using e-cigarettes, which are easy to buy.

How will telecom carriers fare in a highly competitive market?

The traditional telecom market is getting saturated and facing upheavals, including a drop in revenue from traditional calls and SMS, a tighter management policy and changes in technology.

Number of international visitors to Vietnam sets 'record' after pandemic

Vietnam welcomed 2.95 million foreign visitors in January-November 2022, 21.1 times up year on year, but still down 81.9% compared with pre-pandemic levels in 2019.

Su-30MK2, Mi helicopters rehearse in Hanoi

On December 2, Su-30MK2 fighters performed in a rehearsal to prepare for the upcoming Vietnam International Defense Exhibition 2022.

Vietnam sends condolences over passing of former Chinese leader Jiang Zemin

Vietnamese leaders on December 2 cabled messages of condolences to Chinese leaders over the death of former General Secretary of the Communist Party of China (CPC) Central Committee and former President of China Jiang Zemin.

Ministry proposes canceling funding plans over disbursement delays

Disbursements of public funds sourced from foreign loans in the year through November had moved at a snail’s pace, reaching only slightly more than 25% of the full-year plan.

Hanoi to pilot bike rental service in six urban districts

Hanoi has approved a year-long pilot bike rental service programme in Hoan Kiem, Tay Ho, Dong Da, Ba Dinh, Hai Ba Trung, and Thanh Xuan districts.

Weightlifters hope for Olympic qualification from world championship

It was scheduled to be held in Chongqing, China, but this changed in March due to COVID-19 measures in China. The new location was announced in April.

Striker Nguyen Van Quyet named best player of 2022 V.League 1

Striker Nguyen Van Quyet received a statue for the most valuable player of the 2022 V.League 1 season at a V.League Awards ceremony organised on December 1 in Hanoi.

Meteor shower to light up Vietnamese skies on December 13

Local sky gazers will have a rare opportunity to witness the peak of the Geminids meteor shower, with the astronomical event set to occur between midnight on December 13 and the morning of December 14.

Da Nang wins Best Vietnam Smart City Award for third time

The central city of Da Nang has been granted the Best Vietnam Smart City Award 2022, the third time so far.

Newly-established, re-operating enterprises up over 33% in 11 months

Vietnam saw nearly 194,700 newly established and re-operating enterprises in the first 11 months of 2022, up 33.2% over the same period in 2021, a 1.3 times higher than the average rate in January – November period from 2017 - 2021.

Politburo members discuss review of resolution on HCM City development

Party General Secretary Nguyen Phu Trong on December 2 chaired a Politburo meeting on a project to review the 10-year implementation of a resolution on the orientations and tasks for the development of HCMC until 2020 and 2030, with a vision to 2050.