Trends in using electric vehicles in Vietnam and the world

Electric cars are gradually replacing gasoline cars

According to data from automotive industry research and analysis firm JATO Dynamics, electric vehicles accounted for 6% of total vehicle sales worldwide in 2021 - nearly double the 3.1% share in 2020. Specifically, in 2021, about 4.2 million electric vehicles were sold globally, a sharp increase compared to sales of 2.01 million units in 2020.

According to data from Tokyo-based research firm MarkLines Co, global electric vehicle sales in 2022 increased by 66.6% compared to 2021, reaching 7.26 million units. Notably, the market share of electric vehicles accounted for 9.5% of total global vehicle sales in 2022.

In China, electric vehicle sales are expected to increase by about 80% to 4.53 million units in 2022. Meanwhile, in European countries including Germany and the UK, electric vehicle sales are expected to increase by about 30% to 1.53 million units.

Top 5 sales of electric car manufacturers in the world in 2022 (Q1 - Q4). Source: INSIDEEVS

In Europe, Jaguar plans to sell only electric cars from 2025, Volvo from 2030, and British carmaker Lotus aims to produce only electric cars from 2028. According to Volkswagen, 70% of its sales will be electric cars from 2030. Many governments around the world also aim to ban the sale of internal combustion engine cars. The end of the gasoline car is considered inevitable, and is related to many factors, the decisive factor of which is technology, and everything is happening very quickly.

In recent years, Vietnam's socio-economic development has been relatively stable and has shown many signs of improvement, making Vietnam a potential market for automobile development in general and electric vehicles in particular. However, Vietnam's car ownership rate is still much lower than that of other countries in the region, at only 46 cars/1,000 people. This figure is only 1/10 of Thailand's and 1/20 of Malaysia's. This is considered an opportunity for car manufacturers to invest and develop production in Vietnam.

The Government has had preferential tax policies for electric cars. From March 1, 2022, the Government decided to reduce the special consumption tax to 3% for cars with less than 9 seats (previously revised at 15%) to promote the development of electric cars in Vietnam. Battery-powered electric cars are also exempt from registration tax for 3 years, starting from March 1, 2023 according to Decree No. 10/2023/ND-CP dated January 15, 2023. In the next 2 years, this tax rate will be equal to 50% of the tax rate for gasoline and diesel cars with the same number of seats.

The trend of clean energy vehicles in the world is increasingly popular.

Meanwhile, world oil prices depend heavily on geopolitical fluctuations. International organizations predict that this fuel market will change continuously. This will greatly affect the car buying decisions of consumers around the world in general and in Vietnam in particular.

According to a survey conducted by a reputable automobile forum in Vietnam, 99.4% of consumers over 25 years old have heard of electric cars, of which 82% are interested and have learned about electric cars. Notably, of those who have learned deeply about electric cars, more than 45% are certain to choose to buy an electric car in the next 12 months.

Regardless of age, consumers are optimistic and believe that electric cars will be the means of the future, helping to reduce environmental pollution. This view shows the strong acceptance of consumers for electric cars in general, and the great potential of the electric car market in Vietnam in particular.

Vietnamese customers are increasingly interested in electric vehicles.

In the past 2 years, many car manufacturers have been introducing electric motor products using clean energy. Vietnam currently has VinFast with electric motorbikes, electric buses and electric cars. Besides the domestic electric car brand VinFast, many major car manufacturers have planned to enter Vietnam: Kia introduced the EV6 model, Hyundai launched the IONIQ 5, Audi launched the e-tron GT.

At Vietnam Motor Show 2022, a series of electric car models were first revealed as a way to probe the market, such as Mercedes EQS with two versions EQS 450+ and EQS 580 4MATIC, Lexus with LF-Z, Toyota with bZ4X... However, all of the above car manufacturers produce mid-range to high-end electric car models with quite high prices.

VinFast VF 8 is an electric car model that many Vietnamese people are interested in.

However, in the near future, the Vietnamese market will welcome a popular electric car model, the Wuling HongGuang MiniEV, which is expected to open a completely new segment in the Vietnamese automobile market - small electric cars. The selling price of this model is expected to address the market gap between high-end scooters and the lowest-priced A-class hatchbacks.

According to many experts, this car model could be an affordable choice for many people, and at the same time cause electric car sales in Vietnam to explode in the near future.

Mr. Nguyen Dang Khoa (35 years old, Ha Dong, Hanoi) said: “The need to own a car for transportation is currently very high. However, the obstacles of price and parking space make many people postpone their dream. Therefore, a small, environmentally friendly, easy-to-move electric car with a predicted "soft" price like Wuling HongGuang MiniEV makes me very excited and waiting for this electric car model”.

After TMT Motors announced its cooperation with the GM - (SAIC - WULING) joint venture for exclusive distribution in Vietnam, HongGuang MiniEV has received widespread public attention because of its more accessible price.

According to data from JATO, in 3 years (from 2020, 2021 and 2022), Wuling HongGuang MiniEV is the best-selling mini electric car model in the world. This product is researched and developed by GM - (SAIC - WULING) - the world's leading automobile joint venture, with cumulative sales of more than 25 million vehicles. This joint venture is contributed by 3 shareholders: General Motors (GM) of the US with half of the total shares, along with SAIC Motor and Wuling Motors. Wuling HongGuang MiniEV is manufactured, assembled and distributed exclusively in Vietnam by TMT Motors, the car is expected to launch in the second quarter of 2023.

According to the specifications published in other markets, the Wuling HongGuang MiniEV has a compact size with a length of about 2.9m, a width of 1.5m, and a height of 1.6m, with a wheelbase of only about 1.9m - much more compact than other car models currently on the Vietnamese market, suitable for urban travel needs. In particular, with low charging capacity, the car can be easily charged at grounded household power outlets at low cost./.