The Road to Recovery: Vietnam’s Automotive Industry Revs Up

The latest report from the Vietnam Automobile Manufacturers Association (VAMA) reveals a 14% month-over-month increase in domestic automobile sales for February, with a staggering 86% year-over-year growth.

Rebounding to Prosperity

After a brief setback in January due to the Lunar New Year holidays, Vietnam’s automotive market is regaining its momentum with impressive sales growth.

According to VAMA, a total of 21,606 automobiles were sold in February, with passenger cars accounting for the majority at 14,549 units.

Locally assembled vehicle sales surged by 21% from the previous month, reaching 11,067 units. Imported cars also witnessed an 8% growth in February, with 10,539 units sold.

Vietnam’s automotive market rebounds with strong growth in February. Photo: Phương Lâm

TC Motor reported that Hyundai sold 2,286 passenger cars in Vietnam, a slight decrease from the 2,347 units sold in January. The Hyundai Accent led the sales with 455 units, while the Elantra brought up the rear with only 57 units sold in February.

VinFast, on the other hand, delivered an impressive 12,500 electric vehicles in Vietnam during the same month. This included over 5,200 VF 3s, more than 3,000 VF 5s, approximately 2,000 VF 6s, and over 570 VF 7s.

As predicted, the Vietnamese automotive market is quickly regaining its footing after the Lunar New Year holidays.

This period also coincides with automakers offering significant discounts of up to VND 100 million to clear out their 2024 inventory.

The substantial price reductions, coupled with the rush to purchase electric vehicles before the end of the registration fee exemption, are believed to have contributed significantly to the market’s robust growth in February.

Electric Vehicles Dominate the Best-Sellers List

With VinFast’s remarkable performance, electric vehicles continue to lead the market. VinFast models also dominated the top 10 best-selling cars in Vietnam for February.

The VF 3, VF 5, and VF 6, all urban SUVs from the Vietnamese electric carmaker, took the top three spots respectively.

The Ford Ranger and Mitsubishi Xpander followed suit, with sales of 1,111 and 1,053 units respectively, securing their spots in the four-digit sales club for February.

The Mazda CX-5, Ford Everest, Toyota Vios, and Honda City were the next best-selling gasoline-powered cars. Rounding out the top 10 was the VinFast VF 7, with over 570 units of this electric SUV delivered to Vietnamese customers.

Popular Korean models like the Hyundai Accent (455 units), Kia Carnival (451 units), and Kia Seltos (426 units) fell outside the top 10. Mitsubishi’s impressive newcomer, the Xforce, also failed to make the cut.

Fierce Competition Ahead

The Vietnamese market is witnessing intense competition, not only between models within the same segment but also between gasoline and electric vehicles.

The extension of the complete registration fee exemption for electric vehicles in Vietnam for another two years is expected to boost the growth of this segment further.

Additionally, the introduction of new hybrid models, particularly plug-in hybrids, is likely to impact the market share currently held by gasoline and diesel vehicles.

If hybrid vehicles receive similar incentives as electric cars in the future, the sales of internal combustion engine models in Vietnam may face a challenge.

Vietnamese customers will have more hybrid options. Photo: BYD

Last year, the VinFast VF 5 outsold many internal combustion engine models in Vietnam, becoming the best-selling car with over 32,000 units sold out of a total of 87,000 VinFast cars delivered in 2024.

Throughout the first two months of this year, the VF 5 has consistently ranked among the top-selling models, second only to its smaller sibling, the VF 3.

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