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Vietnam Autos Report Q1 2010Published by: Business Monitor International Published: Nov. 13, 2009 - 41 Pages Table of Contents
AbstractChanges to the industry's tariff structure have yet again been central to the performance of Vietnam'sautomotive industry, although the results differ between vehicle segments. The country's new vehiclesales rose by 31% year-on-year (y-o-y) in August, but a change in tax policy boosted sales of five-seatpassenger cars by 50% compared to August 2008. After a new tax structure was introduced based on thesize of vehicles, sales of five-seat cars rose from an average of 2,200 per month in H109, to over 3,000 inJuly and August. Total vehicle sales in August reached 10,555 units, as sales in the SUV/MPV segmentfell 2%. From April 1, the purchase tax on vehicles with six to nine seats rose from 5% to 10-15%.Less explicable is a decline in monthly imports. Vehicle imports into Vietnam fell by 16% in Augustcompared to July's record tally, which considering the sustained health of domestic vehicle sales, appearsto be against industry trends and with no apparent cause. Imports in August fell to 7,300 units from the8,700 units recorded in July and follows six months of consistent import growth. On an annual basis,imports are already close to surpassing the industry's target for the whole of 2009. Imports for the eightmonths to August reached 39,600, while the target for the year is 40,000 units. This has prompted BMI torevise our forecast for full-year imports upwards, while a slight upwards revision of our sales forecast fordomestically produced vehicles results in a decline of just 0.5% for total industry sales. The fluctuation in Vietnam's trade tariffs, as well as currency exchange rates which are causing problemsfor carmakers producing in the country, have contributed to Vietnam's 12th place in BMI's BusinessEnvironment Ratings for the automotive industry in Asia Pacific. There are plenty of reasons to attractcarmakers to the country. The market has witnessed stellar growth, and according to the above-averagerating for its potential over the next five years, sales growth should be maintained. However, low scoresfor country structure and 'Limits to potential returns' drag the total score down to 47.5 from a possible100. Half of the locally producing carmakers posted positive growth in the first nine months of 2009, whichwas an improvement from just one in H109, although the competitive landscape remained largely thesame. Toyota Motor retained its lead and turned its 13% drop in sales from H109 into a 4% increase for9M09. Mercedes-Benz Vietnam achieved the best growth of the top 10 manufacturers with a 23% rise insales, but VMC performed best out of all carmakers with 67% growth y-o-y. Truong Hai Autoleapfrogged Vinamotor to take the second place held by the latter in the same period of 2008, afterachieving growth of 1% compared to a 37% decline for Vinamotor. Get Full Details About This Report >> |
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