GM's new outlook for Vietnam

Gaurav Gupta

GM Vietnam’s managing director Gaurav Gupta tells VIR the changes represent a new beginning for General Motors, bringing Vietnam in line with the group’s new worldwide corporate strategy.

How do you expect domestic consumers familiar with Vidamco’s popular, affordable cars such as Matiz or Lacetti to react to the launch of Chevrolet retail brand in Vietnam?

Estimates have Vietnam’s automobile industry shifting about 150,000 units this year. With the low car penetration of about ten per 1,000 people, or 1 per cent penetration, as well as with the huge two-wheeler population of about 26 million who eventually buy or move up to buy four-wheelers, we believe that the prospects for Vietnam’s automotive market only go up. We believe the local industry will be more than double in nine to 10 years. GM Vietnam wants to grow more and more and it would be a pleasure to have a double-digit market share, from our current 6.6 per cent, in the short term and take it even higher from there as we develop our product pipeline to bring global cars into Vietnam over the next three to five years. In fact, the Chevrolet brand has been growing at 40 per cent in Vietnam this year over last year and we are pushing this growth ever faster.

Will GM increase its manufacturing investment in Vietnam together with making Chevrolet its retail brand?

We will first have to invest more in the new brand in the Vietnamese market. With this plan, we will bring in the right products and will be able to engage with the local customers more actively than in the past. Of GM’s 4.5 million sales this year-to-date worldwide, 2.35 million units are of the Chevrolet brand. So we will look at offering a wide range of products under the Chevrolet brand in Vietnam– from mini-cars to sport utility vehicles (SUVs).

Does the arrival of the new Chevrolet brand in Vietnam mean GM Vietnam will stop making Daewoos here?

We will not discontinue producing the current car lines. While the demand for the lines remains, we will continue selling them in the local marketplace. With our manufacturing facility in Hanoi, which began operation in 1995, GM Vietnam currently has an annual assembly capacity of 20,000 vehicles both for sale in Vietnam and for export.

What is GM Vietnam’s localisation rate at the moment and is there any roadmap for you to raise this rate in the near future?

We have been committed to the Vietnamese market for almost 18 years now and over time we have had different levels of localisation rates for different products. Overall, our localisation rate is currently at 23 per cent. The concern here in Vietnam is that the underdeveloped local supply base is a constraint for localisation plans.