Vietnam’s new vehicle market plunged by almost 61% to 7,714 units in August 2021 from 19,601 units a year earlier, according to wholesale data released by the Vietnam Automotive Manufacturers Association (Vama).
Vietnam is dealing with its worst surge in coronavirus infections since the pandemic began early in 2020, forcing the government to impose some of the strictest lockdown restrictions seen in the region so far.
The south of the country, including Ho Chi Minh City, is the worst affected area where residents have been prohibited from leaving their homes unless for emergencies.
This after the country’s GDP rebounded by 6.6% year on year in the second quarter from close to zero growth a year earlier during the initial stages of the pandemic, driven by strong exports and manufacturing output. Full year growth forecasts are being revised significantly down due to the current lockdowns.
Vehicle sales in the first eight months of the year were still up by 8.3% at 157,777 units from 145,689 a year earlier, with passenger vehicle sales rising by 8% to 114,831 units while commercial vehicle sales were up by close to 9% at 42,946 units.
Truong Hai (Thaco) group, the local assembler and distributor of KIA, Mazda, Peugeot, BMW-Mini and a significant player in the commercial vehicle segment, reported a 21% rise in group sales to 60,619 units in the eight month period. This includes a 54% jump in Kia sales to 25,411 units, a 5% drop in Mazda sales to 15,365 units and a 3% fall in Thaco truck sales to 14,535 units.
Toyota sales increased by just 1% to 35,113 units year to date while Mitsubishi Motors’ sales rose by 10% to 16,246 units, Honda 13,508 units (-9%), Ford 13,517 units (+7%) and Suzuki 7,364 (+6%).
The VAMA data did not include sales by domestic start-up VinFast, which delivered 29,480 vehicles in Vietnam in 2020. The company is reported to have sold 2,310 vehicles in August, up by almost 55% year on year, while year-to-date sales amounted to 22,000 units. It is preparing to launch its first electric vehicle (EV) and has been rolling out an EV recharging network across the country.
Vietnam is looking to raise its emission standards to Euro V in January 2022 which is expected to affect imports from neighbouring countries such as Thailand and Indonesia, but could favour VinFast which has been lobbying the government for additional EV sales incentives.