While car prices in 2020 were significantly lower compared to the pre-Covid-19 period, customers had become more cautious in spending, leading to an 8% year-on-year drop in car sales to 296,634 units.

Vietnam’s rising income per capita would soon move cars from a luxury product with a passenger vehicle density of 34 per 1,000 to a more ordinary one with a density level comparable to countries in the region.

Car sales number in Vietnam in the first seven months of this year dropped 28% year-on-year to 131,248 units across all segments.

The government’s decision to slash the registration fee for domestically-produced cars by 50% is set to further boost the sale of domestic cars in the two remaining quarters of this year.

All have suspended operation during the 15-day nationwide social distancing period, while resumption of production would depend on the actual pandemic situation.

In January, Vietnam imported nearly 4,000 cars worth US$106 million, up 14% month-on-month in volume but down nearly 49% in value.

The company is concerned that demand from China, which accounts for half of the group’s shipments of latex, will fall.

The year of 2019 was a difficult period for Vietnam’s auto market, but also marked positive performances of most local car producers.

Among the incentives, the government is urged to lower the special consumption tax for locally made parts to help them reduce prices to compete with foreign manufacturers.