Jumping Car Prices, Users Hesitate to Spend

Many agents are willing to offer discounts of up to hundreds of millions of VND, but still have no customers. Photo: Hoang Pham.

Since the beginning of the year, the Vietnamese automobile market has not shown positive signs as purchasing power has been declining month by month. Many car manufacturers and dealers have quickly implemented a series of promotional programs to stimulate sales but have not achieved the desired results.

Mr. Hoang Vuong (Hanoi) shared that he had intended to buy a new car after the Lunar New Year, but given the continuous price reductions, he decided to wait for further discounts.

Buyers are wary of purchasing at the moment

“In fact, my family had planned to buy a new SUV for work and travel, but with the prices continuously decreasing, I’m worried that I will lose money if I buy now,” Mr. Vuong added.

According to a survey, the prices of many popular car models have sharply dropped by hundreds of millions of VND over the past 2-4 months. Dealers have been offering a series of promotions such as waived registration fees, complimentary accessory packages, or cash discounts, which have made many customers afraid of overpaying and have caused them to wait for further price reductions.

Many customers are choosing not to buy vehicles during this time, hoping for higher discounts.

On social media groups dedicated to cars, there are continuous posts aiming to lower prices, which have caused the prices of many car models to further decrease. Some posts specifically request discounts of 100-300 million VND for certain car models.

In the comments section, many accounts suggest that buyers should wait for even higher discounts.

Mr. Nguyen Lan (Ho Chi Minh City), a sales consultant at a Suzuki dealership, stated that although the prices of cars have decreased, the number of customers has not increased. As a result, he and many of his colleagues have had to reduce their commissions in order to attract customers. Meanwhile, many customers are willing to negotiate prices, sometimes even requesting discounts of tens to hundreds of million VND, which has made it challenging for sales consultants.

“Customers want to get the lowest price possible, and if I don’t offer a discount, I will lose customers, so I have to reduce my commission to provide incentives for customers. Despite the significant price reductions this season, the number of car purchases has not increased. Customers continuously negotiate prices, which makes it difficult for many sales consultants,” Mr. Lan shared.

Price reductions do not lead to increased sales

In reality, despite the implementation of various programs by car manufacturers and dealers, the overall market demand has not achieved the expected results. Certain car models that used to be popular have faced significant price reductions but have still experienced declining sales.

Prior to this, Mr. Van Cuong (Hanoi), a sales consultant at a car dealership, also mentioned that sales staff at this time have had to reduce their commissions and accept losses in order to offer discounts, but the results have not been promising.

“Customers tend to compare prices, so the sales staff has to reduce their commissions to make the sale. There have been weeks where sales staff had to pay for advertising and still incurred losses without any sales,” Mr. Cuong shared.

Hyundai Santa Fe, a popular 7-seater SUV from Hyundai, used to be subject to significant price reductions of up to 200 million VND, but now it’s only experiencing a decrease of about 180 million VND. However, according to statistics from TC Group, Hyundai Santa Fe has only sold 1,712 units since the beginning of the year, ranking behind direct competitor Ford Everest, which has sold 3,263 units in the same period. Meanwhile, the Honda Accord sedan, despite being offered a 100% registration fee waiver by many dealers for several months, still has not achieved an average monthly sales volume of 10 units.

Despite multiple incentives, the Honda Accord continues to have slow sales. Photo: Thuong Thuong.

According to a report by the Vietnam Automobile Manufacturers’ Association (VAMA), Honda Accord has sold only 26 units from the beginning of the year until now, which is lower than the sales volume achieved in May 2022 alone.

Recently, during a session of the National Assembly on June 1st, Minister of Finance Ho Duc Phoc stated that the government has agreed to a proposal to reduce the registration fee by 50% for domestically-produced cars.

However, many car sales staff and customers believe that this solution will not be able to revive the Vietnamese automobile market. In fact, some ongoing promotions by car manufacturers and dealers have already exceeded the 200 million VND mark, but they have not been able to attract customers. If a 50% registration fee reduction is implemented, it would only result in a maximum reduction of a few tens of millions of VND.

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