Businesses can import cars, will car prices decrease?
The Thai government has issued a Type Approval certificate for vehicles exported to Vietnam. This is considered the basis for imported vehicles to reappear on the market.
According to statistics from the General Department of Vietnam Customs, during January, only about 17 cars with less than 9 seats were imported into Vietnam. In February, the number of imported passenger cars to Vietnam was only about 10, a sharp decrease compared to the same period last year.
This explains why the market is lacking popular imported car models like Toyota Fortuner or Honda CR-V.
However, this thirst will be solved in the near future, when car manufacturers meet all the documents required by Decree 116, notably the quality type certificate issued by a competent foreign authority.
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| The new batch of CR-V cars will arrive at Vietnamese ports in the coming time after a period of being unable to import. |
Mr. Pham Anh Tuan, Head of the Policy Subcommittee of the Vietnam Automobile Manufacturers Association, confirmed that the Thai government has agreed to issue type approval certificates for vehicle models exported to Vietnam.
Meanwhile, Mr. Hoang Ha, Director of the Department of Science and Technology, Ministry of Transport, said that the quality certificate, if issued by a competent state agency or an agency authorized by competent associations, will be accepted in accordance with the spirit of Decree 116.
For the certificate issued if it has equal or higher standards in Vietnam, especially in terms of environmental issues, it is accepted.
This can be considered a positive signal for businesses importing cars from Thailand and good news for consumers. Imported cars are scarce, while Thailand is the country with the largest number of passenger cars exported to Vietnam.
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| Cars imported from Thailand will partly relieve the thirst for imported cars in the market. |
Currently, Ford, GM, Honda, Toyota... all have imported cars from Thailand. According to Honda Vietnam, the new generation CR-V will arrive in Vietnam in March. In addition, with the type quality certificate, other car models such as Honda Accord, Honda Civic, Honda Jazz, Chevrolet Colorado, Ford Ranger or Toyota Yaris... can all be imported to Vietnam in the near future.
However, another notable issue is that imported cars must wait for inspection in each batch, which can take up to 2 months. During the 2-month waiting period, the importing company will have to bear the cost of storage and capital because it cannot immediately bring the cars to the market to sell for cash.
This will not reduce the price of cars to consumers much even though cars imported from Thailand are eligible for the 0% import tax policy.
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| The popular SUV Toyota Fortuner has yet to come to Vietnam. |
Meanwhile, businesses importing cars from other countries such as Indonesia or Japan still do not have a type approval certificate.
Mr. Pham Anh Tuan said that there is currently no signal from Indonesia or Japan about the type quality certificate. Indonesia is the place to produce Fortuner, the best-selling car of Toyota Vietnam and some other car models in the 2018 business plan such as Wigo. All Lexus cars sold by Toyota in Vietnam are imported from Japan and currently cannot be imported as before.
The thirst for imported cars will be somewhat relieved in the coming time with the number of imported cars from Thailand. However, whether the price will decrease as expected or not is still open to question.
In a recent meeting with automobile businesses and associations of the Government Office regarding Decree 116, Minister Mai Tien Dung emphasized that administrative barriers should not be placed to create costs, for example, testing each batch of cars takes up to 2 months and costs 10,000 USD, so agencies must seriously consider it.
The Minister also said that he would come up with a solution as soon as possible. At the latest, next week, ministries and agencies will meet to consider each aspect and each issue.
