Vietnam's regulators to halve registration fees to boost car sales

A car showroom in Ha Dong district in Hanoi. — VNA/VNS

HANOI (Xinhua): The Vietnamese government is laying the groundwork to cut registration fees levied on locally-made cars by half as an economic slowdown threatens to affect demand for vehicles, Vietnam News reported on Friday (June 9).

The cut, scheduled to be effective for six months starting from July, would reduce the government's budget revenue by up to 9 trillion Vietnamese dong (about US$380 million), according to the Ministry of Finance.

Vietnam's auto industry production and sales dropped sharply in April from March, stoking concerns that the Southeast Asian country's auto market could shrink this year, the Vietnam Automobile Manufacturers Association (VAMA) said in a report.

Retail sales of new vehicles by VAMA member-manufacturers slipped 39 per cent to 50,017 units in the January-April period from a year ago, while sales of imported cars fell 16 per cent to 42,784 units.

Car manufacturers recorded a drop of 19.3 per cent in their production in the first four months of the year, said the Ministry of Industry and Trade in a report, adding that local businesses maintained a quite high inventory accumulation.

Despite the fact that Vietnam's previous cuts in 2020 and 2022 helped revive the auto market as car sales soared dramatically, the Finance Ministry said the upcoming cut would not revive auto sales as much as the last two cuts.

When the global supply chain was disrupted during Covid-19 lockdowns in 2020 on the supply side, the automotive industry was forced to reduce production and delay delivery to consumers, while consumer demand for vehicles exceeded supply.

But currently carmakers are struggling to find buyers as consumers hold off on purchases because of higher borrowing costs and a weakening economy, according to auto dealers.

The cut could also negatively impact the country's free trade commitments since it is only applied to locally-made vehicles. Auto importers have long voiced their concerns over the perceived unfair treatment, said the Ministry of Finance.

Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

Vietnam , car , registration , fees


Next In Aseanplus News

Rugby-Uruguay’s Dosantos to miss New Zealand showdown after ban
South Korea's eSports superstar 'Faker' in line for military exemption after Asian Games gold
Afghan woman sprinter sends message of defiance at Asian Games
India foreign minister says he spoke to Blinken, Sullivan about Sikh separatist murder
Swimming superstars Qin and Zhang star as China send Olympic warning in Asian Games blitz
Eain Yow and Co lose in team semis but women in final
US Supreme Court to hear Warner Music case on limits to copyright damages
Asean News Headlines at 9pm on Friday (Sept 29, 2023)
Mohd Azeem qualifies for Asian Games 100m semi-finals
Bangkok readies new airport terminal to deal with tourists rush

Others Also Read