HCM CITY (VNS)— It is the rush season right now, but there is no sign of bustle in the auto industry.
A report from the Viet Nam Automobile Manufacturers Association (VAMA) says that the domestic auto market has been on the decline since 2010.
This year, it is estimated that the market will consume just 100,000 units, the same level as in the years before 2008.
The disappointing results mean that there is no surge in sales even during the traditional rush season.
In a normal year, auto sales and manufacturing increase at the end of a year and the time near to Lunar New Year. This year, however, the figures remain were very modest.
Last month, just 6,800 units were produced, VAMA said, affirming that the figure was much lower than in previous years.
Sales in October was down 21 per cent year-on-year at around 8000 units, while for the first 10 months as a while, the figure of 94,000 marked a 37 per cent fall.
Many car makers have scaled back production plans.
According to the Vietnam News Agency, Toyota has changed its production target for the year from 36,000 to 25,000 units. Other companies have changed their production schedules as well, with some working just two or three days per week.
The situation is worst at companies importing cars.
The General Department of Customs says that in the first nine months of this year, auto imports year-on-year fell by 46.5 per cent in value and 56 per cent in volume.
Many big companies including Hyundai Thanh Cong, did not import a single vehicle or several months.
Many importers said that they have cancelled up to 60 per cent of their orders.
Experts as well as industry insiders say the government's policies on fees and taxes have worsened the situation for the auto industry. They say Viet Nam needs stable taxation policies that allow firms to make feasible development plans.
Currently, nine kinds of taxes and fees are imposed on cars in Viet Nam, pushing prices well beyond the reach of most Vietnamese citizens. This has to change soon for the auto industry to survive and become a major sector in the economy, they add. — VNS