Car Import to Vietnam Doubled Amidst Covid-19
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Completely built-up (CBU) cars imported to Vietnam in July reached 14,407 units with a total turnover of US$ 290.8 million, reducing 5.9% in quantity and 13.3% in values compared to June.
However, combining the first seven months of 2021, the number of imported CBU cars increased 111.2% compared to the same period in 2020 to achieve a turnover of US$ 2.1 billion, according to the initial statistics of the General Department of Vietnam Customs. CBU units imported in Vietnam from January to July were mostly from Thailand and Indonesia, which accounted for 80% of the total imported cars. Specifically, 47,493 cars were imported from Thailand and 28,362 cars from Indonesia, growing 134.8% and 60% respectively compared to the same period last year.
|CBU cars from Thailand accounted for a significant part of imported car market in Vietnam in the first seven months of 2021. Photo: Vietnam Finance|
The Vietnam Automobile Manufacturers Association (VAMA) reported that its members consumed more than 166,500 cars of all types in the first seven months of 2021, up 27% compared to the same period in 2020. If categorized by origin, 94,109 domestically assembled cars and 72,407 imported cars had been sold, increasing 15% and 47% respectively.
Official data from TC Motor, the official partner of Hyundai, revealed that sales of Hyundai cars in Vietnam from January to July reached 38,066 units. VinFast sold more than 19,700 cars in the same period.
Combining the sales published by VAMA, TC Motor and VinFast in the first seven months of 2021, a total of 224,302 units of different types were handed over to customers across Vietnam.
|An official Hyundai service garage managed by TC Motor in Vietnam. Photo: Bao Cong thuong|
These numbers were not fully reflective of the car market in Vietnam. In addition to VAMA members’ announced sales, the market attracted foreign brands such as Mercedes-Benz, Nissan, Audi, Jaguar Land Rover, Subaru, Volkswagen and Volvo whose business results were not revealed.
According to sales specialists, the strong increase in CBU cars imported to Vietnam in the first seven months of 2021 came as a surprise, as purchasing power in the car market plummeted in recent months due to the Covid-19 pandemic. This can be due to car businesses’ anticipation of possible improvement in the buying power when Covid was controlled and particularly the peak season at the end of the year.
Representatives of major brands such as Audi, Subaru and Volkswagen said car import was not disrupted despite complicated Covid occurrences at the global and regional levels, ready to supply to the customers in need.
Joint ventures that both assembled and imported cars in Vietnam such as Toyota Vietnam could supply cars to customers as normal, except for Toyota Corolla Cross, which has been imported to Vietnam since August 2020. There has been serious lack of the model in Vietnam’s market due to high demand, combining with limited resources.
Suzuki Vietnam also denied significant disruption of Suzuki cars imported to Vietnam due to the Covid-19 pandemic. The import of CBU and car components for the two models Suzuki XL7 and Suzuki Ertiga quickly resumed following some months of delay due to the lack of semiconductor chips at the global level.
|Car assembling and import slowing down in recent months due to the Covid-19 pandemic. Photo: VOV|
However, the Covid-19 pandemic has been causing car assembling and import to slow down. Due to the government’s strict social distancing and lockdown orders, many car dealerships are closed temporarily to ensure Covid prevention.
Sale specialists also believed that cultural factors might play a role in the reduction of purchasing power in Vietnam in August. In addition to the continued impacts from the Covid-19 pandemic, August in the Gregorian calendar coincides with the seventh month in the Lunar calendar; the latter is considered an unlucky time for business and trade.
The car market in Vietnam is likely to return to normal after the seventh Lunar calendar month, as Covid is expected to be controlled across Vietnam and the vaccination rate increases.
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