Vietnam’s automotive market experiences sharp decline in 2023 compared to other countries in the region.

According to statistics from the Association of Southeast Asian Car Manufacturers (AAF), Vietnam has experienced the sharpest decline in car sales in the region over the past year.

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According to AAF statistics, the 7 major Southeast Asian markets including Indonesia, Thailand, Malaysia, Philippines, Vietnam, Singapore, and Myanmar have sold a total of over 3.35 million units in the past year, a slight decrease of 2.1% compared to 2022. Vietnam’s numbers do not include the sales of TC Motor – a Hyundai distributor.

The report also highlights that if excluding Myanmar’s 52.5% decrease, but with a small-scale sales volume of under 4,000 units in 2023, Vietnam is the country with the highest decline in the region, reaching 25% compared to the previous year.

Adding up the data from VAMA and TC Motor, the total new car sales in Vietnam in the past year reached 369,431 units, a deep decrease compared to the record of over 500,000 units achieved in 2022.

If this figure is put into AAF’s overall ranking table, Vietnam ranks 5th in the region in terms of market consumption. Following Indonesia, Malaysia, Thailand, and the Philippines, and dropping one place compared to 2022.

Indonesia remains the largest new car consumption market in Southeast Asia and the only country to sell more than 1 million units in the region. However, they still suffer from the overall decline with a 4% decrease.

Similarly, Thailand with 775,780 units sold, decreased by 8.7% compared to 2022 and dropped to the 3rd place in Southeast Asia, giving way to Malaysia. This country recorded 799,731 new units sold in 2023, a 10.9% increase compared to the previous year.

Malaysia and the Philippines ranked 4th are the only two Southeast Asian countries to witness positive growth in the past year. Among them, the Philippines’ sales volume is 429,807 units, a 21.9% increase, the highest in the region. Singapore and Myanmar rank 6th and 7th respectively with 38,670 and 3,357 units in 2023.

2023 was a “difficult” year for the Vietnamese car market.

According to experts, the decline of the entire automotive industry has been forecasted since mid-2023. The reasons are due to the volatility and unpredictable nature of the economy as well as the unstable interest rates from banks, which have contributed to affecting consumers’ car purchasing needs.

In Vietnam, car manufacturers have tried to stimulate demand by launching a series of new models along with various promotional programs. Meanwhile, the Government has also implemented a policy to reduce 50% of the registration fee for domestically assembled cars from July to the end of December 2023, but it is still not enough to help revive the market.

SOURCEcafef
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