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Larger cars neglected, small ones selling like hot cakes
The domestic automobile market has experienced many ups and downs since the beginning of the year following policy adjustments.
The shock caused by tax policies
It was really a shock to automobile manufacturers of the Vietnam Automobile Manufacturers’ Association to see sales in April 2009 down sharply by 43 percent in comparison with April last year. The sales of MPVs even plunged by 68 percent as a result of the higher luxury tax, applied as of April 2009.
Manufacturers could not have imagined that sales of seven-seaters with cylinder capacities of over 2.0L would drop so dramatically. In March, Toyota sold 1,050 Innovas, while it sold 268 only in April.
The Fortuner model, a model which stunned the public at its launch, saw 880 units sold in March. However, sales dropped dramatically to 282 units in April.
However, Toyota’s sales were still better than Ford’s and Vidamco’s.
Sales of Ford Everest plunged from the peak of 609 units in March to nine in April. GM-Daewoo sold only three Captivas in April, while it sold nearly 500 the previous month.
It is clear that the lower tax on models with cylinder capacities of less than 2.0L has opened up opportunities for smaller models. That explains why the Gentra and Lacetti of GM-Daewoo have been selling well, while the manufacturer was also able to sell 450 Sparks in April, much higher than the 75 sold in March.
In March, Toyota sold 15 Vios Limos, while the figure soared to 217 in April, raising the total number of Vios models sold in the month to 400. In April, 331 Corolla Altis were sold, while only 187 cars were sold the month before.
This month, the automobile market has partially improved as the government, in an effort to stimulate demand, has slashed the car ownership registration tax by a half, effective from May 1 to December 31, 2009.
Complaining and adjusting business at the same time
According to Ford Vietnam, though the Everest 2009 model will not be launched onto the market until the end of June, the company has received more than 200 orders in the two weeks since releasing information about the model.
Regarding smaller cars, the demand for Vios and Corolla Altis has increased sharply. Toyota, the manufacturer of the two models, by the last week of May 2009 had got nearly 700 orders for each model. Previously, the manufacturer churned out some 100 Corolla Altis a month. Now, though having raised its production capacity by three-fold, it still cannot meet the demand. If customers place orders right now, they will not get their cars until September or October.
Automobile manufacturers, on one hand, complain that they have been suffering from the narrowed market and are asking for a reconsideration of tax policies, on the other hand are still having to draw up new business plans.
Honda has launched a new Civic version with some improvements in order to attract more customers. Corolla Altis, the direct rival of Honda Civic, will see a new version marketed in mid June.
A new surprise is expected to come from Ford Vietnam. Car players may well know that Ford’s Fiesta came in third in the ‘Car of the year’ competition. In order to own a Fiesta, Chinese customers have to wait three months. The good news is that Fiesta will be present in Vietnam soon.
VietNamNet, TP
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