Mitsubishi Motors to focus on the Vietnam's market
Mitsubishi Motors’ Executive Vice President Kozo Shiraji shared plans to build the second automobile plant in Vietnam at a meeting with Deputy Prime Minister Vuong Dinh Hue on January 15.
The reported US$250-million plant with a designed capacity of 30,000-50,000 vehicles a year is expected to meet the strongly growing demand in Vietnam as well as to expand the group’s presence in the region.
Mitsubishi Motors is considering a second automobile plant in Vietnam.
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“By investing in an automobile plant in Vietnam, Mitsubishi Motors will enjoy an abundant workforce and tariff incentives. Moreover, if Vietnam raises its localization rate in the automobile industry to 40%, its exports to other ASEAN members will enjoy zero tariffs.”
Vietnam aims to become a leading industrial nation by 2020, with the auto industry as one of its main pillars. However, new car sales fell by 10% on-year to 272,750 units in 2017 from a record 300,000 units in 2016, according to the Ministry of Industry and Trade. The sharp drop was attributed to the abolition of import tariffs in January 2018.
Mitsubishi Motors aims to expand local production in Vietnam since the company considers Vietnam a very important market in Southeast Asia, alongside the emerging markets of Thailand, Indonesia, and the Philippines, shared a source at Mitsubishi Motors Vietnam with Hanoitimes.
“We are currently studying the potential and ways to contribute to the development of the country’s auto industry,” added the source. However, regarding the second automobile plant, Mitsubishi Motors declined to comment as no details have been decided to date.
In the meantime and in the near future, Mitsubishi Motors will focus on its current factory in Binh Duong. The group is now assembling Outlander “as we continuously make remarkable steps to reaffirm our long-term commitment to Vietnam."
Mitsubishi Vietnam’s first plant in the southern province of Binh Duong has an annual capacity of 5,000 automobiles.
In a related move, Mitsubishi Motors has signed a deal with the Vietnamese government for joint research to promote electric vehicles (EV).
As Vietnam seeks ways to reduce carbon dioxide emissions and to produce environment-friendly cities, Mitsubishi Motors will cooperate with Vietnam Industry Agency under the Ministry of Industry and Trade to study efficient EV usage and public policy programs that can support the speedy adoption of sustainable automotive technology, according to the Japanese automaker.
While vehicle sales in Vietnam have been increasing on the back of economic growth, air pollution is becoming a serious problem as environment-friendly vehicles, such as EVs and plug-in hybrids, are not promoted yet.
Under the agreement, the Japanese carmaker will share its knowledge on tax and subsidies related to these vehicles, as well as conduct research on charging infrastructure and the country’s road system.
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