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Vietnam to see boom in car demand
Vietnam will see a boom in car use by 2020 as forecasted at a seminar held by the Heavy Industry Department of the Ministry of Industry and Trade (MIT) in Hanoi on August 21.
The seminar held that 2020 will begin a booming period for the country’s car demand with a rate of 38 cars per 1,000 population that will increase to over 50 cars per 1,000 population by 2025.
It also forecasted that cars of less than 9 seats will lead the period, helping to boost car manufacture and assembly as well as auxiliary industries, and reduce trade deficit.
According to the MIT, to anticipate the demand increase, Vietnam should boost the domestic car industry by focusing its resources onto the strategic segment of cars of less than 9 seats.
In addition, the government should have policies to protect the domestic market by levying high taxes on CBU (completely-built unit) cars before its ASEAN Free Trade Area (AFTA) commitments will be applied in 2018.
The government also needs solutions to boost auxiliary industries by drawing more foreign investment and intensifying technology transfer process.
Other steps include the development of transport infrastructure in order to reduce traffic jams, and the issuance of regulations and laws to solve environmental and transport problems.
At the seminar, a representative from the Japan Automobile Manufacturers Association (JAMA) said that Vietnam ’s fledgling car industry needs more suitable policies to facilitate manufacturers’ operation and reduce taxes in order to increase their competitiveness.
By the end of 2007, Vietnam ’s rate of car ownership was 8 cars per 1,000 population, ranking 50th among 52 car manufacturing countries.
VNA
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