Chinese cars are growing strongly in the Vietnamese market

The wave of Chinese cars massively landed in the Vietnamese market

After a long period of market exploration, since 2023, Chinese automakers have continuously launched the latest car models in Vietnam, with the hope of dominating one of the markets. most potential in Southeast Asia.

Recently, a sharp increase in imported cars from China has been recorded.

Transportation Magazine, an agency of the Ministry of Transport, citing a preliminary report from the General Department of Customs, cumulatively in the first 3 months of 2024, there were 5,821 complete cars of Chinese origin imported into the country, reaching a golden value. nearly 177 million USD. Compared to the same period last year, total car import turnover from China in the first quarter of 2024 increased by 144% in volume and 91.3% in value.

Unlike before, Chinese cars entering Vietnam are not distributed through a third party anymore, but are imported to Vietnam as genuine, and even cooperate with local businesses to install them. assembled in water.

Wuling

Wuling is a name that many people expect will become a brand with low-cost cars, making it easier for ordinary consumers to access cars.

On February 18, 2023, TMT Motors signed a strategic cooperation agreement with GM – SGMW joint venture to produce, assemble and exclusively distribute electric cars of SGMW joint venture in Vietnam. TMT Motors’ electric car factory is located in Van Lam district, Hung Yen province, with production and assembly capacity of phase 1 of 30,000 vehicles/year and phase 2 of 60,000 vehicles/year.

The first product is the Wuling Mini EV model, which was officially delivered to Vietnamese customers from September 29, 2023. Thus, with this launch, Vietnamese users have more opportunities to own electric cars at “unbelievably cheap” prices.

However, after more than a year, up to now Wuling Mini EV has not had a significant market share and the Chinese car company still has a lot of work to do if it wants to win the trust of Vietnamese consumers.

MG

MG appeared a long time ago, originally a British brand but now 100% owned by SAIC with a development and production unit in China. This brand also entered Vietnam many years ago through distributor TC Services (belonging to Tan Chong Motor) but was transferred to parent corporation SAIC.

From July 1, 2023, Shanghai Automobile Corporation (SAIC) takes over the distribution of MG cars in Vietnam, expanding the product portfolio by importing MG5 MT and MG RX5 from China. Among them, MG5 MT is the cheapest C-class sedan in Vietnam with a listed price of 399 million VND. The RX5 is positioned on par with the Mazda CX-5 with a listed price from 739 million VND.

Haval

By August 2023, Haval – a sub-brand of Truong Thanh Auto Group (GWM) – entered the Vietnamese market with the H6 HEV model. Currently, Haval Vietnam is only opening for sale the H6 HEV line in the Vietnamese market.

In early April 2024, the company also confirmed that the next car model, Haval Jolion, will return to Vietnam with a hybrid version. Currently, this car model has received genuine deposits. Sales consultants say this model will be launched in April 2024. The expected price is about less than 700 million VND.

Lynk & Co

On December 16, 2023, Chinese car company Lynk & Co officially introduced to customers its first series of products to Vietnamese customers, 3 SUV models Lynk & Co 01, 05, 09 and 1 sedan model Lynk & Co. Co 03+. GreenLynk Automotives is the genuine importer and distributor of Lynk & Co in Vietnam.

Haima

December 17, 2023, Chinese car company Haima officially launched the Vietnamese market with two mid-sized MPV models Haima 7X and electric variant Haima 7X-E.

Among them, the Haima 7X gasoline car model brought to Vietnam has only one version, the 7X Premium. The 7X-E electric variant is introduced in two versions: Comport and Premium. This is also the first pure electric car model in the MPV segment in Vietnam.

According to information from Haima car distributor in Vietnam, the next car model called Haima 8S is expected to launch in the Vietnamese market in April 2024. The car will be available for sale with 3 versions to choose from.

After unsuccessfully entering the Vietnamese market for the first time more than a decade ago, this time the Chinese car company Haima returns with a new distributor, Carvivu companydetermined to conquer the market. In Vietnam, Haima is not a strange name because this Chinese car brand was present in the domestic market in 2011 by an import company in Hai Phong. However, 6 years later (2017), this brand withdrew.

Omoda & Jaecoo

On April 4, 2024, new energy vehicle brand Omoda & Jaecoo (sub-brand of Chery group) and Geleximco group signed a joint venture and cooperation contract to build a factory in Thai Binh. According to the plan, the Omoda & Jaecoo new energy vehicle factory has a capacity of 200,000 vehicles per year. The factory construction will be carried out in three phases, with a total investment capital estimated at more than 800 million USD. During the factory construction process, the car models that Omoda & Jaecoo brought to Vietnam were imported genuine from Indonesia. According to the company, the two models Omoda C5 and E5 were first launched in the third quarter. Jaecoo 7 and 7 PHEV will launch in the fourth quarter.

Chinese car company Chery appeared in Vietnam in 2009 through cooperation with Hoa Binh Automobile Joint Venture (VMC). The first product, the domestically assembled QQ3, costs about 180 million VND. A year later, the company launched the “high-end” navigation car Riich M1 priced at 288 million VND. However, the low selling price still does not help these car models have good sales and a place in the hearts of Vietnamese customers. By 2013, this brand withdrew from Vietnam.

BYD

China’s largest electric vehicle company – BYD – is about to start business operations in Vietnam by opening a genuine dealer in Hanoi, expected on May 1, 2024. BYD cars sold in Vietnam will be imported from China. Among BYD’s products, the Atto 3 small high-rise car model is the most awaited by users. This is also one of BYD’s best-selling car models globally.

Aion

Aion – China’s pure electric car company, affiliated with Guangzhou Automobile Group (GAC) is the next brand to launch in Vietnam. Aion already has an importer and distributor in Vietnam, Harmony Vietnam company, a subsidiary of Harmony Group (China). This distributor is looking for partners to establish agents, preparing for expected business operations in June 2024. Currently, the first showroom is operating (not yet officially) in District 7, Ho Chi Minh City, where customers can come to see the pure electric car model Y Plus.

New competitors of Japanese and Korean cars

Thus, a total of 5 Chinese auto brands are doing business in Vietnam (Wuling, Haval, Haima, Lynk & Co, SAIC) and 3 more brands are about to sell cars (Omoda & Jaecoo, BYD). and Aion). This number is equal to Japanese car manufacturers (Toyota, Suzuki, Honda, Nissan, Isuzu, Mazda, Lexus) and much higher than Korean car manufacturers (Hyundai, Kia).

Besides, there are also many car models from Chinese brands imported and distributed in Vietnam by private companies. The most famous include Beijing and Hongqi. These two brands have been present in Vietnam for a long time through the official distributor Kylin-GX668 company with a small number of car models imported completely from China. For Beijing (belonging to BAIC Group) is the famous X7 model and Hongqi (Hong Ky) is the duo H9 and E-HS9. However, a modest dealer system and a business strategy that has not received much investment make it difficult for both Beijing and Hongqi to reach the majority of customers in Vietnam.

It can be seen that recently, many Chinese car companies are “ambitious” to dominate market share in countries with great automotive potential, including Vietnam.

Besides issues such as importing or investing in building factories in Vietnam to take advantage of preferential policies from the Government, implementation time, and price, there is a major problem that Chinese car manufacturers face. is consumer psychology.

Firstly, during the period from 2010 to present, car manufacturers from Japan and Korea have always held the majority of market shares in all car segments. According to VAMA’s report, in 2022, Toyota continues to hold the top position with 22% market share, Hyundai (17%), Kia (15%), Mitsubishi (10%), Mazda (9%), Honda (7%) %), Ford (7%), the remaining 13% includes all other brands, of which only a small part are Chinese brand cars.

In 2023, Hyundai holds the top position with sales of 67,450 cars (accounting for 22.3%); Toyota is at number 2 with sales of 57,414 vehicles (19%); KIA is at number 3 with 40,733 (13.4%); Ford is at number 4 with 38,322 vehicles (12.6%) and at number 5 is Mazda with 35,632 vehicles (11.7%). The remaining car manufacturers account for about 20% of the Vietnamese car market share. For the whole year 2023, the total sales of VAMA members across the market reached 301,989 vehicles.

Obviously, emerging brands that come later will be under great competitive pressure from brands that have already established their names in the eyes of consumers.

Second, a large number of consumers still have some reservations about Chinese products. In particular, with a car being a valuable asset, user requirements will also be more stringent. Cars from Germany, Japan, and Korea are still the top choice of the majority.

Some Chinese car models launched in Vietnam in 2010-2012 were judged to have “borrowed” the exterior ideas of some other car models already on the market. On the other hand, product quality has not been proven… These things make many individual users not really interested in Chinese cars.

However, recently, the genuine distribution of Chinese car models has partly helped Vietnamese customers feel secure when choosing, because maintenance and care have been more guaranteed. Similar to the case of Korean cars more than a decade ago when they first entered the market, Chinese cars are not without opportunities in Vietnam. To change the majority’s prejudices, car companies need time, perseverance and especially serious investment in their products.

However, it cannot be denied that Chinese cars are “growing rapidly” and gradually becoming a “new force” in the Vietnamese automobile market.