The 2011 automobile market was gloomy with no growth rate and the sales just equal to that of 2010. A lot of automobile manufacturers reportedly meet difficulties.
The report by the Vietnam Automobile Manufacturers’ Association VAMA shows that its 17 member corporations had sold 98,709 cars by the end of November 2011, a decrease of one percent from 2010. As such, the number of cars sold in 2011 would be equal to that of 2010 only if the sales volume in December 2011 is higher than 14,000 cars.
Meanwhile, Vietnam had imported 50,980 cars by the end of November of 2011, while the figure is expected to reach 53,500 in the whole year 2011, which is equal to that of 2010.
As such, the total number of cars to be consumed in 2011 in a whole would be 165,000 cars, the same with 2010’s.
The gloomy automobile market has been attributed to the economic difficulties with high inflation which forces people to fasten their belt. In previous years, the automobile always got bustling in the fourth quarters. Meanwhile, the market keeps quiet in the fourth quarter of the year, despite noisy sale promotion campaigns. Sales agents have to reduce the sale prices of up to 2000 dollars.
Truong Hai has surpassed Toyota Vietnam to top the list of the automobile manufacturers who can sell the highest numbers of cars. In the last 11 months, the manufacturer sold 28,556 cars of different kinds, while the figure could reach 31,000 this year. Toyota ranks the second with 27,218 cars sold in the last 11 months.
Meanwhile, a lot of other manufacturers complain about the low sales. Sanyang Motor, for example, sold 644 cars only in the last 11 months, and VMC 972, Mekong 581 and Samco 350.
In 2011, only the cars with five seats and less, witnessed the high growth rate of over 20 percent with 40,000 cars sold, while MPV and SUV decreased by 4 percent, and commercial vehicles (trucks and buses) decreased dramatically by 16 percent. The economic difficulties and the inability to access bank loans have been cited to explain the sharp fall of the demand for commercial vehicles.
Besides, experts believe that the demand for personal cars would increase in the future, while the demand for commercial vehicles would decrease. The current consumption proportion is 50/50, but it would change in the future to 35/65 percent.
The Circular NO 20 of the Ministry of Industry and Trade which was issued on May 12, 2011 stipulates that importers have to show a lot of kinds of documents which importers believe “inaccessible”. The legal document was also described as a method to close the doors for private importers to bring cars to Vietnam.
After the circular took effect on June 26, 2011, the number of cars under the mode of complete built unit CBU to Vietnam has dropped to the low level of 3000 cars a month.
The decisions by the Hanoi and HCM City local authorities to raise the car ownership registration tax to 20 percent in Hanoi and to 15 percent in HCM City released in November 2011, have once again stirred up the public.
VAMA’s has expressed its worry that with the higher tax, automobile manufacturers would see the sales down, which also means that they would have to scale down the production.
Analysts have predicted that the market in 2012 would keep gloomy as the current difficulties still have not been eased. Toyota Vietnam’s General Director Tachibana has forecast the total consumption level would drop to 140,000 in 2012.