The Electric Vehicle Revolution in Vietnam: Is the Market Ripe for a Boom in 2025?

Fueled by favorable policies, new consumer trends, and the entry of international brands, Vietnam is emerging as a bright spot in the electrification of transportation in Southeast Asia. However, behind the impressive growth figures, questions remain about the country’s readiness for a true boom.

Electric vehicle sales soar, market share expands unprecedentedly

In the first quarter of 2025, Vietnam’s automotive market recorded total sales of over 101,000 vehicles, a nearly 47% increase from the same period last year—a rare growth rate in the region. Notably, VinFast—the only domestic electric vehicle brand—achieved a growth rate of 176.8%, according to Focus2Move. This performance propelled electric vehicles to account for 40% of total passenger car sales, far surpassing the average in Southeast Asia.

Industry experts predict that in 2025, electric vehicle sales (including battery electric vehicles – BEVs and hybrids) could increase by another 25-30% compared to 2024, pushing the market share of electric vehicles to 15-20% of the total passenger car market. This growth exceeds expectations, especially considering that the market has just entered the initial phase of the transition.

Favorable policies: A powerful boost from the government

It is undeniable that the growth of the electric vehicle market is backed by a clear support system of preferential policies from the government. Vietnam currently offers an exemption on registration fees for electric vehicles until 2027 and a waiver of special consumption tax for the first five years from the date of production or import.

Additionally, Resolution 29-NQ/TW on green economic development sets the goal of completely transitioning to electric or clean energy vehicles by 2050. This long-term commitment strengthens the confidence of both investors and consumers.

A diverse market with increasingly open consumers

VinFast is no longer the only player in Vietnam’s electric vehicle landscape. In 2025, the domestic market witnessed the strong entrance of international brands such as BYD, Hyundai, KIA, MG, Mercedes-Benz, Audi, and Porsche. Notably, BYD—the world’s largest electric vehicle manufacturer—has established its presence in Vietnam and plans to introduce multiple models from this year onward.

According to a survey by KPMG Vietnam, over 70% of consumers aged 25-40 indicated their willingness to switch to electric vehicles if the pricing is reasonable, charging is convenient, and operating costs are low. This group represents young, tech-savvy customers who make up a significant proportion of the population in major cities, a key factor for the electric vehicle boom.

Charging infrastructure: The biggest hurdle on the road to acceleration

Despite the positive growth trajectory, Vietnam’s electric vehicle market still faces a significant bottleneck in charging infrastructure. Currently, most of the charging stations are built by VinFast, with over 150,000 public charging ports installed by the end of 2024. However, these are largely concentrated in major cities and along key national highways.

A more significant issue lies in the lack of standardization among different car brands. Each manufacturer develops its own infrastructure, resulting in an inconsistent experience for users. Additionally, the installation of private charging stations in apartments or high-rise buildings remains complicated due to legal procedures, while the domestic power grid struggles to meet the high power demand.

Where is the Vietnamese electric vehicle market headed in 2025?

Based on current indicators, Vietnam’s electric vehicle market is in its infancy but holds evident potential for a breakthrough. Several plausible growth scenarios have been proposed by research organizations and analysts for 2025.

VinFast is predicted to continue leading the way, constantly expanding its product range from the mini VF 3, urban crossovers like VF 5 and VF 6, to large SUVs VF 8 and VF 9, catering to diverse consumer needs in the domestic market.

It is forecasted that electric vehicle sales in Vietnam for the whole of 2025 could reach between 60,000 and 80,000 units, an increase of about 30-40% compared to 2024. This growth largely depends on the pace of improvement in public and private charging infrastructure, especially in major cities and high-rise residential areas.

If the hurdles related to charging infrastructure are significantly addressed in the second half of the year, the market share of electric vehicles in the total number of cars consumed nationwide could reach 20-25%, a crucial step towards carbon neutrality and sustainable transportation by 2050.

Real growth, but a boom requires a solid foundation

It is undeniable that Vietnam is on the right track in the race to transition to electric vehicles, backed by supportive policies, product diversification, and an increasingly positive consumer mindset. However, to truly unleash the market’s potential, addressing infrastructure bottlenecks, streamlining the installation process for charging stations, and standardizing charging technology across the market remain crucial.

If these conditions are met in the next 1-2 years, 2025 could become a pivotal year, propelling Vietnam to the forefront as one of the leading emerging electric vehicle hubs in the region.

TH (Tuoitrethudo)