New vehicle sales in Vietnam declined by just over 9.5% to 23,368 units in July 2020 from 25,828 units in the same month of last year, according to wholesale data released by the Vietnam Automotive Manufacturers Association (VAMA).

The rate of decline has slowed significantly in the last two months from the lows seen earlier in the year – when parts of the economy were under lockdown to help limit the spread of the COVID-19 pandemic. Vietnam has coped better than most countries in Asia with the coronavirus pandemic, thanks to early pre-emptive action taken by the central government. 

Economic growth slowed to just under 0.4% year on year in the second quarter after growing by 3.7% in the first quarter and 7% in the whole of 2019, while most economies in the region shrank in the second quarter. Domestic economic activity has returned to close to normal, while exports in the first half of the year were 3.7% higher. Foreign direct investment was negative, however, and the country is still closed off to foreign tourist arrivals.

Total vehicle sales in the first seven months of the year were down by just under 27% at 126,088 units from 171,817 units in the same period of last year. Sales of passenger vehicles fell by over 28% to 92,060 units in this period from 128,292 units, while commercial vehicle sales were down by just under 22% at 34,028 units from 43,525 units.

Truong Hai (Thaco) group, the local assembler and distributor of brands such as Kia, Mazda and Peugeot and a significant player in the commercial vehicle segment, reported a 21% drop in group sales to 42,589 units in the seven month period. This includes a 33% plunge in Mazda sales to 13,455 units and a 15% drop in Kia sales to 14,010 units.

Toyota remained the leading vehicle brand in the country, albeit with sales falling by close to 31% to 30,484 units, while Honda sales were also down by 31% at 13,216 units. Mitsubishi Motors sales fell by close to 9% to 13,005 units, underpinned by strong demand for the Xpander MPV.