Mazda raises prices amid a wave of car price reductions.

During the year-end rush, car manufacturers engage in a price war, offering discounts of up to 200-300 million VND per vehicle to stimulate demand. However, many customers were surprised when Thaco Truong Hai increased the prices of Mazda cars.

Observations at several Mazda showrooms show that in November, models such as the Mazda3, Mazda CX-5, and Mazda6 all saw price increases, with a maximum increase of 20 million VND compared to October.

Massive year-end discounts continue unabated.

In recent months, the Vietnamese car market has experienced significant fluctuations as car manufacturers compete by lowering prices to boost sales during the 2017 year-end period.

Consequently, car prices have dropped sharply, with some models seeing reductions of nearly 200-300 million VND per vehicle, something consumers have never witnessed in the history of the Vietnamese car market.

The massive price war in the Vietnamese car market in 2017 - Photo by Quang Dinh

The biggest price drop in the current car market is for the Hyundai Santa Fe, with a reduction of up to 235 million VND per vehicle. Specifically, the lowest-priced version of this model, the Santa Fe 2.4 gasoline version, has dropped from 1.1 billion VND to 898 million VND.

The German automaker also surprised everyone by joining the price war with a significant discount of 130 million VND per unit for the Touareg SUV. In addition, the two versions of the Scirocco sports car also received substantial price reductions of 100-120 million VND.

In November, Mitsubishi Vietnam also aggressively reduced the price of its Outlander crossover by 206 million VND for both the 2.0L and 2.4L versions, with the lowest-priced model dropping from 1.123 billion VND to 975 million VND. Most notably, Toyota's best-selling Vios has fallen to around 500 million VND after several price reductions by the Japanese automaker.

Known for being "strict" when it comes to lowering car prices, Toyota couldn't stay out of the price war to compete.

Therefore, in early November, Toyota drastically reduced the price of the Vios model by nearly 60 million VND. Specifically, the Vios TRD version saw a price reduction of 58 million VND, from 644 million to 586 million VND.

This is seen as a tactic used by car manufacturers to quickly sell off used cars this year in anticipation of the reduction of import taxes on automobiles from ASEAN to 0% at the beginning of next year.

Why did Thaco increase the price of Mazda cars?

It's quite surprising that while car manufacturers are competing to launch numerous year-end sales promotions hoping to boost sales, Thaco is raising car prices.

Thaco's price increase for Mazda models amidst soaring prices has surprised many - Photo by Que An

Specifically, the Mazda 6, Mazda CX-5, and BT-50 models have increased in price by 20 million VND per vehicle, reaching 879 million VND for the Mazda6 2.0 AT version, 919 million VND for the 2.0 AT Premium version, and 1.019 billion VND for the 2.5 AT Premium version. Similarly, the Mazda CX-5 has been adjusted to 869 million VND for the 2WD version and 919 million VND for the AWD version.

The Mazda BT-50 model has been adjusted to a price of 825 million VND/vehicle for the 3.2 AT version, 670 million VND/vehicle for the 2.2 AT version, and 640 million VND/vehicle for the 2.2 MT version.

At the same time, all versions of the Mazda 3 model saw a price increase of 10 million VND, reaching prices ranging from 650 million VND to 770 million VND per vehicle, depending on the version.

Thaco only did not adjust the selling price for the Mazda 2 model; this model continues to maintain a price range of 515 million to 562 million VND, depending on the version.

With the price increase for Mazda models, Thaco is the first automobile manufacturer and distributor to adjust car prices upwards, following a series of consecutive price reductions. This may signal that automobile manufacturers and distributors have found a way to halt the price war between brands. Of course, the decision to increase Mazda car prices is based on market developments and Thaco's business forecasts.

According to Mr. Bui Kim Kha, Deputy General Director of Truong Hai, this move aims to ensure the company's profitability because in previous months, the company had to "sacrifice" profits to lower prices amidst a sluggish market. He also revealed that Thaco may make several more price adjustments in the near future.

Many economic experts familiar with the automotive sector see the price war as, on the surface, a way to stimulate car sales. But in reality, car manufacturers are "racing" to take advantage of the fact that import taxes on cars from ASEAN countries will be reduced to 0% at the beginning of 2018.

This suggests that manufacturers are looking to reposition car prices at an acceptable level in preparation for a new phase of intense competition.

However, it is also possible that the price reduction for cars will stop in the near future, as stricter regulations on car imports are expected in 2018, leading to a sharp decrease in imported cars and a rise in selling prices.

According to TTO