Light at the end of the tunnel for auto industry

It follows news that fees aimed to limit vehicle personal usage will not be applied this year.
The Ministry of Transport (MoT) last week published a letter to respond the solicitation from Vietnam Automobile Manufacturers’ Association (VAMA) that it would delay the personal vehicle fees for at least three years.

The letter dated July 6 stated that the MoT would take the lead to further study the personal vehicle fees’ proposal and share it with Ministry of Finance (MoF) and other government agencies. The public will also have valuable input. The MoT perceived “the new fees should only be imposed as long as there is a consensus from the public”.

The ministry concluded it could take three years before coming back with a new proposal.  
This decision brought a smile to auto-makers and sellers. “It is a very encouraging sign  the government and MoT are revising  their position with regards to the new set of fees they wanted to be implemented,” said VAMA in a report.

Michael Behrens, CEO of Mercedes-Benz Vietnam said: “This is an optimistic signal for Vietnam’s auto market. The decision on the 3-4 year postponement of personal vehicle fee application is expected to underpin the up-trend in sales, helping relieve car buyers’ strain. This goes hand-in-hand with the first good signs of upward improvement in the Vietnamese economy”.

Auto sales have fallen regularly since the fees was announced some months ago, with the overall industry year-to-date down 41 per cent versus last year’s same period. A poll run by Dan Tri, a popular online news media, said 52 per cent of the people surveyed said that they no longer envisaged buying a car, while 23 per cent said they had reconsidered it, due to the fees.