Imported cars are about to flood into Vietnam

Regarding the fact that car companies believe that importing cars to Vietnam is difficult due to Decree 116, the Ministry of Transport in a report sent to the Government Office said that many businesses have clearly understood and continue to prepare procedures and conditions for car import business according to regulations.

Regarding the requirements for type approval certificates (VTA), component type certificates (tires, rearview mirrors, front lights, glass) according to Circular 03, regulations on 800m test track, batch inspection, the Ministry of Transport believes that these are consistent with market reality, control the quality of imported cars and create fairness for domestically assembled cars.

Regarding the issue of emissions and safety testing for each type of car in an imported shipment, which could increase the cost by up to 10,000 USD, the Ministry of Transport said that "there is no basis". According to the Ministry's calculations, the cost of emissions testing is 27 million VND for gasoline engines and 28 million VND for diesel engines. The completion time is no more than two days.

The cost of safety testing is 12 million VND/sample. Completion time is no more than two days, the test report is issued the next day if the enterprise provides sufficient technical documents on the sample vehicle.

Representatives of many domestic car manufacturers such as Toyota, Honda, Ford, Suzuki informed that they have sent the necessary documents for imported cars to the authorities and are waiting for the official decision. It is likely that the procedures will be completed soon in the near future.Overcoming the VTA paper barrier, the biggest difficulty among the regulations tightening imported cars of Decree 116, imported cars will soon return to Vietnam from the second quarter of 2018, first with cars imported from Thailand.

Previously,The Ministry of Transport has accepted the VTA certificate issued by the Thai Government for vehicles exported from this country to Vietnam. The shipment of thousands of Honda vehicles arriving at Hiep Phuoc port, Ho Chi Minh City in early March 2018 is an example.

Mr. Pham Anh Tuan, General Director of Toyota Vietnam's Strategic Planning Department, said that Indonesia has sent the VTA papers to Vietnam and is waiting for confirmation. If it cannot export cars to Vietnam, Indonesia could lose 85 million USD in the period from December 2017 to March 2018, taccording to calculations by the Ministry of Commerce of this country. Meanwhile, with cars imported from Japan, Toyota Vietnam also has papers for the Lexus NX300t and Toyota Hiace, which will soon arrive in the country and clear customs in the next few months.

Thailand and Indonesia were the two countries that exported the most completely built-up cars to Vietnam in 2017, with a total of nearly 47,000 cars. The car models that can enjoy 0% import tax and meet the requirement of localizing components of over 40% from these two countries are spread across many segments such as small cars, MPVs, SUVs, and pickup trucks.

VTA papers for imported European cars are mainly luxury cars. Unlike Japanese car manufacturers who complained about the difficulty, Volkswagen, Porsche, Truong Hai (BMW) and many other car manufacturers are calm about this regulation. After Honda, the first imported models of Volkswagen from India and Mexico also arrived in Vietnam, showing that the confidence of European car manufacturers in their ability to meet the requirements of Decree 116 is well-founded.

Thus, about five months after Decree 116 took effect, the arguments and petitions of car manufacturers began to subside as the more important thing to do now is to find a way to meet the VTA paper requirements for imported cars. The prospect of imported cars flooding into Vietnam with a 0% tax rate, a necessary condition to set a cheaper price compared to 2017, is gradually becoming more positive.

The optimistic signal of car manufacturers in Vietnam in resolving VTA papers is also shown by the actions of dealers. After a quiet period before Tet, car deposit-sale activities have resumed. Attention is focused on Honda's new models imported into the country such as CR-V, Jazz. WhileToyota Fortuner, Ford Ranger and many other models are also being booked by dealers, although the exact delivery time has not been determined.

Thanh Nhan