The Chinese Cheap SUV: A New Battle for Vietnam’s Roads

Geely Coolray has just announced its official price in Vietnam, starting at 538 million VND and going up to 628 million VND for a total of 3 versions.

Almost at the same time, the Omoda C5 added a Luxury version, changed the engine type, reduced the equipment, and the price is also cheaper, expected to be at 539 million VND.

Initiating a Price War

With a promotional price of under 500 million VND for the first 555 customers, the Omoda C5 Luxury becomes the most affordable SUV in the B-segment market, even equal to or cheaper than A-SUV models such as the Hyundai Venue (499-539 million VND), Toyota Raize (498 million VND, will increase to 510 million VND from next month), or the Kia Sonet, priced at 539-624 million VND.

Even without the limited-time offer, the Omoda C5 Luxury (539 million VND) and Geely Coolray (from 538 million VND) are still the most affordable SUVs in the Vietnamese market.

A series of Chinese urban SUVs have arrived in Vietnam with competitive prices. Photo: Phuc Hau.

Previously, the Omoda C5 was first introduced with 2 versions and a starting price of 589 million VND, making it one of the most affordable options in its segment, alongside the Mazda CX-3 (from 522 million VND) and MG ZS (from 518 million VND).

The Omoda C5’s price is more accessible than its Korean and Japanese competitors in the same segment, such as the Mitsubishi Xforce (from 599 million VND), Toyota Yaris Cross (from 650 million VND), Hyundai Creta (from 599 million VND), and even a fellow newcomer, the Haval Jolion, which starts at 669 million VND.

To achieve the highly competitive price of 539 million VND, the Omoda C5 Luxury is equipped with a naturally aspirated 1.5L gasoline engine instead of the 1.5L Turbo engine found in the higher-end versions.

The headlights have been changed to halogen projectors, the wheel size has been reduced to 17 inches, the seats are trimmed in leather and synthetic fabric, the gear lever is a straight row type, and the front camera has been removed.

The Omoda C5 Luxury has been modified quite a bit in terms of equipment to achieve its segment-leading price. Photo: Phuc Hau.

Similarly, the Geely Coolray’s price range of 538-628 million VND is achieved by offering the previous-generation model, instead of the new generation that was recently launched in Malaysia.

Like the Omoda C5 Luxury, the entry-level version of the Geely Coolray features 17-inch wheels, headlights without auto on/off function, fabric seats, manual air conditioning, and a reduced number of sensors and airbags.

Previously, MG had success with the “reduce equipment, lower price” strategy with the New MG5. Although bearing the name of a new model, the New MG5 is actually not the latest generation of the MG5 sedan.

Despite its outdated exterior design and unremarkable equipment, the New MG5, with its manual transmission option and a price of 399 million VND, has become one of the most successful Chinese cars in Vietnam.

An Important Direction for Chinese Automakers

In the early stages of the latest wave of Chinese cars, many models were introduced to Vietnamese customers with prices significantly higher than their competitors in the same class.

For example, the Haval H6 was initially priced at 1.096 billion VND. While the car had a hybrid engine and modern equipment, with a price close to 1.1 billion VND, it was still considered a significant barrier for the Haval H6 to compete with other SUVs in the C-segment in Vietnam.

The Haval H6 is an example of a Chinese car that has not achieved success in Vietnam due to its uncompetitive pricing. Photo: Phuc Hau.

Another recent case is the MG4 EV, launched in June 2024, positioned in the B-segment electric SUV category with a price range of 828-948 million VND. This price range is considered unattractive, making it difficult for the MG4 EV to convince Vietnamese customers to make a purchase.

The cars introduced by Lynk & Co were all priced in the billions, causing the brand, which is part of the Geely Group, to struggle to gain a foothold in the Vietnamese market. It was only when the Lynk & Co 06 was launched with a price of 729 million VND that the Chinese SUV brand started to attract the attention of Vietnamese customers.

In general, Vietnamese customers are not yet ready to spend a large sum of money on a Chinese car brand, despite the continuous improvements in quality over the years.

It seems that Chinese automakers have “learned their lesson” from past successes and failures, and the new entrants are taking a more cautious approach, spending more time organizing test drives, gathering customer feedback, and setting appropriate prices.

Chinese cars cannot rely solely on product quality to convince Vietnamese customers to buy. Photo illustration: Phuc Hau.

With the Omoda C5 and Geely Coolray, the new strategy of Chinese automakers is clear: offer a diverse range of quality products, with the base model featuring a competitive price that can go head-to-head with Korean and Japanese brands in the same segment.

Through this approach, with the short-term goal of “selling cars”, along with promotional and after-sales efforts, as well as expanding dealerships, showrooms, and service centers, Vietnamese customers will gradually become familiar with the presence of Chinese cars in the local market.

MG, one of the most successful Chinese car brands in Vietnam, also went through a similar “trial and error” phase. In 2020, MG re-entered the Vietnamese market after an unsuccessful debut 8 years prior.

In the following years, MG continuously adjusted its product lineup and pricing strategy before achieving the level of completeness it has today. The New MG5 played a crucial role in this process, serving as the brand’s “ace card” thanks to its competitive price, offering the space of a C-segment sedan at the price of an A-segment car.

The success of the New MG5 demonstrates the importance of competitive pricing for Chinese car brands in Vietnam. Photo: Vinh Phuc.

The success of MG, and the positive response to the introductory prices of Omoda and Geely cars, show that Chinese automakers should and must have a suitable business strategy when entering the Vietnamese market, with pricing being a critical factor.

If the product has good quality, as long as the brand persists with an appropriate business strategy, maintains regular promotions and improves after-sales service, Chinese cars have a chance to succeed in Vietnam in the next 1-2 years. By then, Vietnamese customers may have become more accustomed to the presence of Chinese car brands in the local market.

On the other hand, if Chinese automakers introduce a limited number of models with few versions and uncompetitive prices, their chances of success will diminish. This is because this group of cars will not be able to compete solely on quality in a market where Vietnamese customers still favor Korean, American, Japanese, or even locally-made electric cars.

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