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Thursday, July 25, 2024

A rebound on the horizon?

By Linh Trang

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The Government’s bold moves, such as the recent auto registration fee cut and the deadline extension for special consumption tax, are expected to provide a much-needed boost for the automotive industry’s recovery in the second half of the year. Demand wanes Cars are considered non-essential consumer goods, so their sales are greatly influenced by the overall macroeconomic conditions and consumer demand. When the economy hits stumbling blocks and people’s incomes decline, the demand for cars would be certainly affected. According to the Vietnam Automobile Manufacturers’ Association (VAMA), car sales in the domestic market during the early months of this year reached 113,527 units, down 36% year-on-year. Sales of private vehicles and completely knocked-down (CKD) cars plummeted by 43% and 40%, respectively. Several factors contribute to this decline, including the expiration of the registration fee cut and high interest rates for car loans. TC Group, the assembler and distributor of Hyundai cars in Vietnam, has also reported slipping sales performance with a drop of 28.6%, equivalent to only 22,903 units sold. Similarly, VinFast, an emerging player in the Vietnamese automotive market, reported a 30.4% decrease in sales, selling 8,483 units during the early months of the year. Projections for the automotive […]
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