Salespeople’s reaction to the pre-registration fee reduction

The auto dealer has high expectations for the reduction of registration fees. Photo: Hoang Pham.

On June 28, Deputy Prime Minister Le Minh Khai signed Decree No. 41, which stipulates the registration fee for domestically produced or assembled cars to be 50% of the current rate. This policy will take effect from July 1 and last until December 31.

Sellers are excited, buyers are indifferent

In an interview with Tri thuc truc tuyen, Mr. Thanh Nam – a sales consultant at a Toyota dealership in Ho Chi Minh City – said that the sales team is very excited when they heard that the preferential registration fee policy will officially take effect from the beginning of next month.

“My colleagues in the car sales industry have also been anxious for the past few days, worrying that the policy may not be implemented from July,” Mr. Nam said.

According to Mr. Nam, many colleagues at the dealership are happy with the news that the preferential registration fee policy for domestically assembled cars will officially take effect from July and last until the end of the year.

“The Vietnamese automobile market in the first 5 months of this year has been fluctuating. Not only me but many colleagues are hoping that this policy will restore the demand for cars and boost purchasing power,” Mr. Nam shared.

Salespeople believe that the preferential registration fee policy for domestically assembled cars will contribute to boosting the market. Photo: Boi Hao.

Notably, Mr. Thanh Nam revealed that the number of car buyers has shown signs of growth since June, when there is more information about the preferential policies for domestically assembled cars.

“Thanks to the ‘double preferential’ commitment from dealers, many customers have chosen to make payments and issue invoices in June to maintain the preferential benefits before waiting until July to pay the registration fee and register the vehicles in order to enjoy further support for the registration fee,” Mr. Thanh Nam said.

Meanwhile, in terms of customers, Mr. Viet Nhan (Ho Chi Minh City) believes that the preferential registration fee policy may only bring the highest benefits to customers who deposit a car in June and register the car after July 1.

“In my opinion, dealers will make adjustments to the incentives to balance once the preferential registration fee policy of the Government takes effect. In fact, many car manufacturers and dealers are currently offering incentives up to 150% of the registration fee, so the Government’s support measure is likely to have little impact on the psychology of customers,” Mr. Viet Nhan commented.

Customers are indifferent to the preferential registration fee policy. Photo: Phuc Hau.

At the moment, some car companies are implementing incentives equivalent to a maximum of 100% of the registration fee for their products in the Vietnamese market, such as Mitsubishi, Volkswagen, and Nissan. In particular, some Honda dealerships are even offering incentives equivalent to a maximum of 150% of the registration fee for a few remaining Honda City models before the official launch of the facelift version to Vietnamese customers, expected to be in the next month.

Prior to the exchange with Tri thuc truc tuyen, many car salespeople also predicted that the incentives offered by car manufacturers and dealers would undergo some changes once the Government’s preferential registration fee policy officially takes effect.

“Increasing incentives or reducing the value of promotions still cannot be concluded at this time. The market’s purchasing power will affect the decisions of manufacturers and dealers, but adjustments are likely to be made to fit the situation,” a sales consultant who preferred to remain anonymous shared.

The Vietnamese automobile market is hoping for a boost

A report from the Vietnam Automobile Manufacturers’ Association (VAMA) shows that in May, the total market in Vietnam consumed a total of 20,726 cars of all types, a decrease of 8% compared to April and down 53% from the same period last year.

From the beginning of the year, the number of domestically assembled cars reached 62,096 units, a 43% decrease compared to the first 5 months of 2022. In the same period, the number of imported cars also decreased by 23% compared to the previous year and is now at 51,431 units.

The Vietnamese automobile market fluctuates in the first half of 2023
Auto market sales in Vietnam in the first 5 months of the year (Source: VAMA)
Month	January	February	March	April	May
	Cars	17,314	23,040	30,038	22,409	20,726

The weakening sales throughout the second quarter have also led to a decrease in automobile supply in Vietnam. According to reports from the General Statistics Office and the General Department of Customs, an estimated 34,608 cars were supplied in May, including 7,608 completed customs procedures for imported cars, while domestic production was estimated at 27,000 units.

From the beginning of the year, the number of imported cars into Vietnam reached 61,954 units with a total value of approximately 1.4 billion USD. Meanwhile, the domestic production of cars after 5 months in Vietnam is estimated at 133,600 units, a 24% decrease compared to the same period in 2022.