Auto market flooded with imports from Thailand, Indonesia

A report of the General Statistics Office (GSO) showed a high car import growth rate in the last year. 

Vietnam imported US$6 billion worth of cars in 2015, an increase of 59% in comparison with 2014. 

These include 125,000 CBU cars (complete built unit) worth US$3 billion, an increase of 77% in quantity and 88% in value in comparison with the year before.

Of the imports, transport vehicles were worth US$1.2 billion, less-than-9-seater cars US$507 million and large-size cars US$34 million.

Analysts noted that of the 10 largest markets from which Vietnam imports cars, including China, Japan, the Republic of Korea, Germany, the UK, France and India, imports from Thailand and Indonesia have seen sharp increase in the last months of the year.

Both of them are ASEAN members.

According to the General Department of Customs (GDC), in the first 11 months of 2015, Vietnam imported 23,516 CBU cars from Thailand, worth USUS$406.1 million. The figures were much higher than 14,416 cars and USUS$243 million in the same period of the year before.

The car imports from Indonesia were lower than from Thailand, but have also seen a high growth rate. In 2014, Vietnam imported 1,686 cars from the market with the value of USUS$16.9 million. Meanwhile, in 2015, the figure rose to 3.277 and USUS$32.6 million. 

Analysts pointed out that Vietnam also imports vehicles in a large quantity from China, but the imports from the market are mostly trucks and specialized vehicles, while the imports from Thailand and Indonesia are mostly those with less than nine seaters.

Vietnam not only imports CBU cars from Thailand and Indonesia, but car components as well, USUS$542 million and USUS$105 million, respectively, in 2015, which were even higher than the CBU import turnover.

Analysts commented that large imports from two ASEAN countries are predictable, especially since the car price decreased by 40-42% recently. 

They believe that the imports from ASEAN would dominate the domestic market thanks to their more reasonable prices, compared with imports from developed countries and domestically made products.

According to the Strategy Research Institute, the car price in Vietnam is much higher than Indonesia because taxes and fees make up 40-50% of the cars’ value.

Toyota Camry in Vietnam, for example, is priced at USUS$50,000, while it is just USUS$40,000 in Indonesia. Similarly, the price of Honda CR-V is USUS$45,000 in Vietnam and USUS$29,000 in Indonesia.

The Ministry of Finance estimated that from 2019 when the import tariff and luxury tax are cut, cars with cylinder capacity of less than 1,000 cm3 would see prices drop by 42%.