Imported cars flood local market despite of poor purchasing power
In this article (5)
Vietnamese firms spent over $903 million in the first quarter importing 41,780 completely-built-up (CBU) cars, according to a report by the General Statistics Office (GSO).
The cumulative import turnover of CBU cars in Q1 2023 increased by 76% in volume and 60.8% in value compared to the same period last year.
In March, 15,000 cars worth $332 million were imported into Vietnam, representing a year-on-year increase of 48.8% in volume and 48.5% in value.
Despite the increasing number of imported cars, the Vietnam Automobile Manufacturers’ Association (VAMA) said that sales for the whole market in the first two months reached just over 17,300 units, due to poor purchasing power.
Local auto experts said this was an unusual and ominous signal as pressure from automobile inventory remains high.
An uncompleted statistic shows that Vietnam’s inventory of cars reached 38,000 units. Facing the gloomy prospect of the market, VAMA has recently proposed that the Government halve the registration fee for locally-assembled or manufactured cars during the first half of the year to boost market demand.
In a letter sent to the Prime Minister, both the Vietnam Automobile Manufacturers Association (VAMA) and the Vietnam Association of Mechanical Industry (VAMI) also jointly asked for an extension of the deadline to pay excise tax.
The Vehicles Importers Vietnam Association (VIVA) has raised its voice to ask for fair treatment after hearing that the Government asked the Ministry of Finance and other relevant ministries to devise a 50% cut on auto registration fees for locally assembled or manufactured cars.
Questions & Answers
Q.What was the total value of completely-built-up cars imported into Vietnam in the first quarter?
What was the total value of completely-built-up cars imported into Vietnam in the first quarter?
Vietnamese firms spent over $903 million importing completely-built-up (CBU) cars during the first quarter. This figure covers the 41,780 CBU cars brought into the country during that period.
Q.Why are local auto experts concerned about the current market situation?
Why are local auto experts concerned about the current market situation?
Local auto experts described the situation as an unusual and ominous signal. This is because car imports are increasing despite poor purchasing power and high inventory pressure within the market.
Q.What measures has VAMA proposed to the government to improve market demand?
What measures has VAMA proposed to the government to improve market demand?
VAMA has proposed halving the registration fee for locally-assembled or manufactured cars for the first half of the year. They have also jointly requested an extension for the deadline to pay excise tax.
Q.Why has the Vehicles Importers Vietnam Association raised concerns with the government?
Why has the Vehicles Importers Vietnam Association raised concerns with the government?
VIVA has asked for fair treatment after learning the government requested a 50% cut on auto registration fees. This proposed cut would apply only to locally assembled or manufactured cars, not imported ones.
Reader pulse
What is your main concern for Vietnam's auto market?
21,031 votes so far