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Hanoi backs spare auto parts industry
Hanoi is ambitious to become a centre of support industries for Vietnam’s car makers, despite the fact that the car industry is operating below potential.
As pointed out in a plan for automobile development for the next two years, auto parts are considered one of the nation’s eight key mechanical sectors.
Planners say it is vital for Vietnam to develop the industry because of its links to other industries and thus to modernisation.
According to Hanoi’s Department of Industry and Commerce, the city now has 16 automobile spare-parts and assembly companies, mainly for lorries and buses.
Most of these spare parts makers have the same complete knock down (DKD) technical background (a complete assembly kit) with low, localised rates, according to Pham Duc Tien, deputy director of Hanoi ’s Department of Industry and Commerce at a conference last week.
Vietnam manufacturers make simple auto products, such as mirrors, glasses, chairs, radio and tires. But 70 to 90 percent of components come from China and the Republic of Korea .
Fierce competition among auto makers has hindered the development the industry in Hanoi.
The auto spare-parts industry uses products from many other sectors, ranging from mechanical items to semi-conductor technology, power and informatics and materials.
Bui Ngoc Huyen, General Director of Xuan Kien Auto Joint Stock Company (Vinaxuki) said spare-parts enterprises should cooperate to promote the development of this sector.
The auto-parts industry has not been given any preferential policies as it is not viewed as a hi-tech sector.
However, the Department of Industry and Commerce in Hanoi has set up a promotion programme to help auto spare-parts makers specialise. Forty enterprises will be initially involved.
An auto specialist argued it would be difficult for Vietnam to export complete built units (CBU) cars in the near future. However, he said Vietnam was in a good position to continue to export spare parts because its skilled workers could produce them cheaply.
So, it seems that, with a little bit of help from the Government, Hanoi’s auto-parts industry could really take off.
VNA
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