EVs will likely continue to be the main growth driver, supported by lower operating costs, policy incentives and expanding charging infrastructure. — VNA/VNS Photo Tuấn Anh

HÀ NỘI — Việt Nam’s automobile market is entering a remarkable transition marked by tightened environmental policies and a rapid shift towards electrification, according to a report by auto research platform oto.com.vn released this week.

The report noted that the solid macroeconomic situation continues to support the long-term growth of the auto sector, where vehicle ownership remains relatively low compared with regional peers.

Statistics show that the Vietnamese economy expanded by more than 8 per cent in 2025, among the highest rates in ASEAN, with GDP per capacity reaching US$5,026 per year, moving the country closer to upper middle-income status.

The domestic auto market is also undergoing a major policy shift, with a roadmap to restrict internal combustion engine vehicles in some urban areas along with tighter emissions standards.

Against this backdrop, purchasing decisions now must take into account total ownership costs, regulatory risks and future technology trends, the report said, adding that consumers have become more cautious in deciding between petrol, hybrid or electric vehicles (EVs).

The demand for second-hand cars has faced increasing pressure from sharp price cuts on new vehicles and stricter emissions requirements, although demand recovered toward the end of 2025 in more affordable segments.

EVs have become a market highlight, with VinFast taking the lead. VinFast sold 175,099 units in 2025, an year-on-year increase of 99.5 per cent, and brought its pure EV market share to 33.9 per cent.

This growth was driven by a broad product strategy ranging from entry-level personal models, such as the VF 3 and VF 5, to service-oriented vehicles like the Limo Green, along with competitive pricing, generous financial incentives and low-interest loan support.

In contrast, sales of new petrol-powered cars for many brands declined significantly in 2025, with some recording double-digit drops. Competition also intensified, with the entry of new brands like Skoda and a growing influx of Chinese automakers, which targeted core segments with aggressive pricing and feature-rich offerings.

The list of the 10 best-selling models in 2025 underscored this market shift, with EVs dominating and VinFast accounting for four models, according to the report.

EVs will likely continue to be a main growth driver, supported by lower operating costs, policy incentives and expanding charging infrastructure, the market research platform predicted.

Hybrid vehicles are seen as a transitional option, while traditional petrol cars will remain under pressure from regulation and price competition.

In the medium term, analysts at Oto.com.vn said that the auto market would grow rapidly in 2026–30, with competition shifting toward technology, services and user experience. It will also be supported by favourable macroeconomic conditions and low car ownership rates.

Việt Nam’s auto market is expected to move toward a total annual volume of around one million vehicles by 2030, from more than 600,000 last year. — VNS