Vehicle sales by 11 foreign-backed car makers in Vietnam fell 22% to 12,652 units in January-June from a year earlier, the Vietnam Automobile Manufacturers Association told Reuters.
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Car sales have been falling since January 2005, when higher consumption taxes were imposed on locally assembled vehicles.
Toyota dominates the market, selling 5,755 cars, up 3% from a year earlier as if offered aggressive rebates and new models such as the Innova crossover.
Ford sales dropped 1% year-on-year to 1,715 cars, pickups and sport utility vehicles, while other auto makers, including GM Daewoo and Mitsubishi Motors faced sharp sales declines of up to nearly 66%.
According to Reuters, Honda Motor said it would start selling its first cars in Vietnam in August, beginning with the Civic sedan.
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By GlobalDataVietnam’s annual per capita income remains one of the world’s lowest at around $US640, but its car prices are among the highest because of high tariffs and taxes. A Toyota Camry sells for around $50,000 compared with $20,000 in Japan, Reuters noted.
Dealers reportedly said only 40 used cars, most of which were luxury brands such as BMW, Lexus and Mercedes Benz, had been imported since May when the government removed an import ban due to high import tariffs.
The fall in sales and slow imports of vehicles had resulted in a tax revenue loss of 2.2 trillion dong ($138m) to the state budget, the finance ministry said.
