Importers propose halving car registration fees
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All 12 members of the Vehicles Importers Vietnam Association (VIVA) have asked the Government to reduce the registration fee on imported cars by 50% to spur demand.
VIVA proposed in the context of a sharp drop in sales and gloomy market forecasts.
According to the association, car importers need help to cope with high inventories due to the sudden decrease in demand.
In the first month of this year, the number of cars imported to Vietnam tripled over the same period last year to more than 12,800 vehicles. The number of imported cars also tripled in the last three months of last year.
Earlier, the Prime Minister ordered the Ministry of Finance and the Ministry of Industry and Trade to consider lowering registration fees for domestically assembled cars.
The Vietnam Automobile Manufacturers Association (VAMA) said tightening credit and rising interest rates have diminished market liquidity, and automobile companies are struggling to cope with high inventories.
According to VAMA, its members reported a decline in sales four months in a row starting last October. Only 17,314 vehicles were sold in January, down 51% from December.
During the Covid pandemic, Vietnam halved registration fees on domestically assembled vehicles, not on imported ones, twice, first in mid-2020 and then again in late-2021. Each reduction period lasted six months.
In the first half of 2020, over 102,900 domestically assembled vehicles were registered. The figure then doubled in the second half of the year.
Questions & Answers
Q.What is the primary reason the Vehicles Importers Vietnam Association (VIVA) is asking the government to reduce registration fees?
What is the primary reason the Vehicles Importers Vietnam Association (VIVA) is asking the government to reduce registration fees?
VIVA is seeking a 50% reduction in fees to stimulate demand for imported cars. They cite a sharp drop in sales and gloomy market forecasts, leading to high inventories that importers are struggling to manage.
Q.Have imported car sales actually decreased, according to the article's figures?
Have imported car sales actually decreased, according to the article's figures?
No, the article states the number of imported cars tripled in the first month of this year compared to the same period last year, reaching over 12,800 vehicles. This trend also occurred in the last three months of last year.
Q.Has the Vietnamese government previously reduced registration fees for vehicles, and if so, which types of vehicles benefited?
Has the Vietnamese government previously reduced registration fees for vehicles, and if so, which types of vehicles benefited?
Yes, during the Covid pandemic, Vietnam twice halved registration fees for domestically assembled vehicles. These reductions did not apply to imported vehicles and each lasted for a period of six months.
Q.What are the wider market conditions affecting car sales, according to the Vietnam Automobile Manufacturers Association (VAMA)?
What are the wider market conditions affecting car sales, according to the Vietnam Automobile Manufacturers Association (VAMA)?
VAMA attributes diminished market liquidity to tightening credit and rising interest rates. Their members have reported a decline in sales for four consecutive months, with only 17,314 vehicles sold in January, a 51% drop from December.
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