Looking back at the highlights of the auto industry in 2024

The Vietnam Motor Show is back!

The Vietnam Motor Show (VMS) is always the focal point and the biggest annual event in the automotive industry. After being temporarily suspended in 2023 for various reasons, the event returned at the end of October 2024.

The Vietnam Motor Show will return in 2024. Photo: Tran Dinh

Notably, many luxury car brands were absent from this year's event, including Mercedes-Benz, BMW, Lexus, Audi, Volvo, and Volkswagen. In addition, popular brands like VinFast , KIA, Mazda, and Peugeot were also absent.

However, this year's event still featured some new elements, such as the appearance of a range of fuel-efficient and environmentally friendly cars. The presence of Chinese car manufacturers also attracted attention due to their attractive features and designs.

Furthermore, VMS 2024 will feature, for the first time, a range of motorcycle brands such as Honda, SYM, Yamaha, UM Motorcycles, Harley-Davidson, Triumph, KTM, and Husqvarna, demonstrating a shift in VMS organizers' approach to customer engagement.

Reduce registration fees for domestically manufactured and assembled automobiles.

Decree 109/2024/ND-CP clearly states that domestically produced and assembled automobiles are eligible for a 50% reduction in registration fees. This policy is effective from September 1, 2024 to November 30, 2024 and is applied in the context of a somewhat sluggish market at the beginning of 2024.

This is the fourth time this policy has been applied to stimulate the market and help alleviate difficulties for businesses after the impact of the Covid-19 pandemic. The policy of reducing registration fees for domestically produced and assembled cars has significantly increased sales during the months it was in effect. Although applied for a shorter period than previous periods, the recent reduction in registration fees has created a significant boost for the domestic automobile market. According to a report by the Vietnam Automobile Manufacturers Association, in the three months with a 50% reduction in registration fees (from September to November), the total number of cars sold was 119,546 units, an increase of 48.2% compared to the three months preceding.

The automotive industry is making breakthroughs.

2024 witnessed breakthroughs for automotive manufacturers in Vietnam. For example, at the end of October 2024, the Hyundai Palisade SUV was exported to Thailand – the largest export market in the region – by the Hyundai Thanh Cong joint venture. This activity is part of Hyundai Thanh Cong's plan to export over 4,000 vehicles to countries in the region during the 2024-2025 period. Notably, the Palisade's localization rate (RVC) is over 40%, meaning the model qualifies for a 0% import tax rate under the ATIGA agreement in the ASEAN region.

Meanwhile, VinFast, Vietnam's number one electric vehicle manufacturer, has a localization rate of over 60%, including the body, engine, roof, and shock absorbers. Compared to internal combustion engine vehicles assembled in Vietnam, this rate is quite high, as the highest localization rate for gasoline and diesel vehicles is around 40%.

Many automotive businesses have recorded positive localization rates. Photo: VF

To achieve 84% localization within the next two years, the Vietnamese automaker plans to utilize additional domestic supply for components including seats, wiring harnesses, lights, rims, braking and steering systems, glass, mirrors, interior and exterior components, etc. Notably, VinFast plans to produce its own battery cells by 2026. Currently, VinFast only packages batteries at its two factories in Hai Phong and Ha Tinh ; the battery cells are still imported from other manufacturers abroad.

Furthermore, many foreign car manufacturers are also looking to invest in production in Vietnam. For example, Tasco has officially signed a joint venture agreement with Geely Group for the assembly and distribution of automobiles in Vietnam, and also signed a tripartite strategic cooperation agreement with the Management Board of the Economic Zone and Industrial Parks of Thai Binh province. The Tasco and Geely joint venture has a designed production capacity of 75,000 vehicles per year for phase 1.

Also in 2024, the People's Committee of Thai Binh province granted an investment registration certificate and business registration certificate to the Geleximco – Chery joint venture. This joint venture plans to build an automobile manufacturing plant in Hung Phu Industrial Park, Tien Hai district, Thai Binh province, with a total estimated investment of up to 800 million USD, divided into 3 phases. The first phase is expected to be completed in the first quarter of 2026.

TC Motor and Skoda Auto have reached a strategic cooperation agreement and plan to build a Skoda vehicle manufacturing plant in Quang Ninh province. The Czech automaker Skoda has chosen Vietnam as the first country in Southeast Asia to establish an automobile assembly plant with production and assembly lines employing advanced, modern technologies, meeting European standards with a high level of automation.

The "wave" of Chinese cars

In 2024 alone, the domestic automotive market welcomed seven new car brands from China. This makes China the largest car brand in the market, surpassing Japan, which currently has nine brands present in Vietnam.

A prime example is BYD's entry into the Vietnamese market in July 2024. In 2025, this Chinese automaker is expected to launch several new models to diversify its product portfolio.

Many Chinese car models have arrived in the Vietnamese market. Photo: Tran Dinh

Despite their massive launch in the Vietnamese market, Chinese car models still don't inspire much confidence among consumers due to the preconceived notions surrounding "Chinese goods," as demonstrated in the Thai market. Specifically, when sales fell short of expectations, BYD in Thailand repeatedly lowered prices, causing controversy among customers because their vehicles depreciated significantly in a short period.

According to data from the General Statistics Office, the motor vehicle production index in November 2024 is estimated to have increased by 2.5% compared to October 2024 and by 36.2% compared to November 2023. For the first 11 months of 2024, the motor vehicle production index increased by 18.3% compared to the same period in 2023 (higher than the 14% growth rate of the first 10 months of 2024).

In November 2024, Vietnam's automobile production and assembly is estimated at 47,300 units, a 3% increase compared to September 2024 and a 47.8% increase compared to October 2023. This marks the eighth consecutive month of growth in domestic automobile production since the beginning of 2024, and the sixth consecutive month of growth. It is also the highest monthly production figure since the start of 2024. This continuous growth has helped the total domestic automobile production for the first 10 months of 2024 reach 336,500 units, a 22.4% increase compared to the same period in 2023. This growth rate represents an improvement over the 15.8% increase in the first 10 months of 2023.

Source: https://congthuong.vn/nhin-lai-diem-noi-bat-nganh-cong-nghiep-o-to-nam-2024-367155.html