Car sales in Vietnam hit 21,769 units in May of this year–excluding Mercedes-Benz, Hyundai, Tesla and Nissan and a handful of other car makers–representing a 13 percent increase over May of last year, according to the Vietnam Automotive Manufacturers Association. Overall, however, for the year-to-date, car sales were down 7 percent over the same period in 2023.

Of note, an article in Business Forum Magazine has lamented that the bulk of this decline was in locally produced vehicles and suggests this might presage an even greater decline of the local car manufacturing industry.

It points out that import tariffs have come down considerably on motor vehicles under the ASEAN Trade in Goods Agreement but are also declining as a result of the European-Vietnam Free Trade Agreement which should see tariffs on cars imported from Europe reduced to zero by 2030.

That said, most car manufacturing in Vietnam is in assembly with local supporting industries limited. In this light, the impact may be minimal compared to other parts of the world with longer, more integrated motor vehicle manufacturing supply chains.

See also: Vietnam’s Automotive Industry 2024: Foreign Investor Cheat Sheet

Vietnam motor vehicle imports, January to May 2024

Source: General Department of Customs