The Russian Lada: An 8-Year Reign with 200,000 Sales Annually – A New Competitor for Vios and Accent in Vietnam?

The arrival of Lada cars in Vietnam has sparked interest, with the first batch of vehicles now in the country. Lada is a well-known brand in Russia, consistently topping sales charts for years.

But in the highly competitive Vietnamese market, can Lada’s presence worry its rivals?

Lada, a brand under the AvtoVAZ umbrella, was once a symbol of Soviet automotive industry. Today, it remains Russia’s top carmaker. In 2024, Lada maintained its leading position with the Lada Granta selling 201,500 units, capturing over 12% market share of new car sales in Russia. This marks the 8th consecutive year that the Granta has dominated Russia’s sales charts.

Another popular model, the Lada Vesta, demonstrated its appeal with sales of 123,200 units, representing a nearly 200% growth, and securing the second spot in 2024 sales.

Notably, both models have already made their way to Vietnam and are poised to enter the market. According to local sources, in addition to the Granta and Vesta, two compact SUVs, the Niva and Niva Travel, are also present, targeting customers who prefer the classic style of a raised ride height, similar to the Suzuki Jimny.

The Lada Granta falls into the B-segment sedan category, competing with the likes of Toyota Vios, Hyundai Accent, and Mitsubishi Attrage. It is powered by a 1.6L engine, producing between 87 and 98 horsepower, depending on the variant. It is paired with either a 5-speed manual or 4-speed automatic transmission. Russians favor the Granta not only for its affordability but also for its simplicity and ease of repair, making it well-suited for harsh operating conditions.

One of the most notable aspects of Lada’s entry into Vietnam is the expected pricing. Initial information suggests that the Lada Granta could be priced from around VND 360 million (approximately USD 15,500), which is significantly lower than its rivals in the segment, such as the Toyota Vios (starting at VND 466 million) or the Hyundai Accent (from VND 439 million). With this pricing strategy, Lada seems to be focusing on delivering a practical and affordable car rather than loading it with fancy features and technology.

However, when compared to well-established Japanese and Korean brands in Vietnam, the Granta falls short in terms of equipment. It lacks modern features such as a touchscreen infotainment system, smartphone connectivity, collision sensors, or a rearview camera.

The Lada Vesta offers a slightly more modern design and equipment than the Granta, along with larger dimensions. Nevertheless, it remains a value-focused proposition, resulting in modest comfort and technology offerings when compared to the overall market.

Therefore, instead of directly competing with popular models like the Vios or Accent, the Lada Granta and Vesta might find their niche as an alternative to older used cars.

Vietnam’s used car market has a substantial demand, especially in rural areas and provinces, where buyers often opt for 8–10-year-old sedans like the Kia Morning, Hyundai Getz, or older Toyota Vios. With rising used car prices and sparse equipment in new budget cars, the Granta could be a compelling option: affordable pricing, new condition, low running costs, and simple maintenance.

However, for Lada to truly establish itself and thrive in Vietnam, two critical challenges must be addressed. Firstly, after-sales service – it remains unclear which official distributor will be responsible for warranty and technical services for Lada vehicles.

Secondly, consumer perception – Vietnamese consumers have a strong preference for Japanese and Korean brands due to their reputation for reliability, low maintenance, and strong resale value. Lada, as a new and somewhat nostalgic brand, will need time to build trust and change perceptions.

Lada’s entry into Vietnam may not immediately threaten established players like Vios or Accent, but it will undoubtedly add a new dimension to the mainstream car market. Offering a stripped-back, affordable car focused on practicality – a formula that has worked for Lada in Russia. With successful localization, robust after-sales support, and competitive pricing, the Lada Granta might not be everyone’s dream car, but it could be the car many people need.