Vietnam records second largest drop in auto sales across Southeast Asia

Vietnam saw the second sharpest decrease, of 25%, in automobile sales in Southeast Asia last year behind only minuscule market Myanmar.

According to the ASEAN Automotive Federation (AAF), in the region’s seven main markets, Indonesia, Thailand, Malaysia, the Philippines, Vietnam, Singapore, and Myanmar, 3.35 million vehicles were sold, a 2.1% decline from 2022.

But the data, compiled from AAF’s members in various countries, does not include sales of Vietnamese firm Hyundai Thanh Cong.

The leaders, Indonesia and Thailand, saw sales drop by 4% and 8.1%. In Myanmar, automobile sales fell to less than 4,000 in 2023, a decrease of 52.5% compared to 2022.

The number of cars sold in Vietnam was 369,431, the fifth highest after Indonesia, Malaysia, Thailand, and the Philippines after falling one place from last year. The Philippines went past it in 2023.

In 2022 Vietnam achieved its highest ever sales of more than 500,000.

But last year the economic downturn, high bank interest rates and the slump in the real estate and securities markets sent demand for cars plummeting.

In July the Government halved the automobile registration fee for domestically assembled vehicles, but it failed to revive demand.

Demand fell in Thailand as banks tightened credit for buying pickup trucks, the most popular segment, according to Thailand Business News.

Production too fell, but at more than 1.8 million vehicles, Thailand remained the biggest manufacturer in the region.

Indonesia remained the largest market and also the only country to exceed the million sales mark. Indonesia wants to become an auto production hub, especially for electric vehicles.

In 2023 it churned out nearly 1.4 million cars, including some of Vietnam’s best-selling vehicles like the Mitsubishi Xpander, which topped the sales chart.