Car imports set for a U-turn

Car imports could be restricted to add balm to a hurting economy.

In light of the Ministry of Industry and Trade’s (MoIT) Circular 20/TT-BCT, from June 26, 2011 when making less than nine-seat car import procedures businesses will be required to show papers stating that they are authorised importers or distributors of genuine car makers and the papers must be certified by Vietnam’s diplomatic agencies abroad.

A lawyer said these regulations aim to protect consumer interests while putting more responsibilities on car sellers and they do not impinge on World Trade Organization (WTO) principles on discrimination towards businesses trading in the same items.

Vietnam is reportedly home to around 5,000 imported car salons nationwide which sell popular brands such as Toyota and Lexus and Mercedes Benz while those have had manufacturing joint ventures or authorised sales agents in Vietnam.

With the regulations, unauthorised salons will hardly get the nod from genuine car manufacturers to stay on par with MoIT requirements.

Besides brand-new cars, government agencies are weighing up further restrictions of secondhand car imported volumes. Towards this goal, technical and tax barriers will be further introduced to limit secondhand car imports.

Latest figures from the MoIT’s Institute for Industrial Policies and Strategies show that completedly built unit (CBU) import volumes sharply rose from 2005-2010, from 4,226 units in 2005 to 27,491 units in 2008, 47,592 units in 2009 and falling to 33,900 units in 2010. Meanwhile, locally made less than nine-seat car volumes could only meet 65 per cent of the market demand in 2010.

Following Vietnam’s commitments to WTO, automobile joint ventures in Vietnam have begun importing CBU cars alongside their conventional manufacturing activities.

For instance, after halting Land Cruiser assembly in Vietnam, Toyota Vietnam shifted into importing this car line in CBU form into Vietnam and prolonged its list of CBU import cars with new brands such as Hilux and Yaris and most recently Toyota Prado, Honda chose to import Accord and Mercedes Benz Vietnam imported S-class and mid-size sport utility vehicles (SUV). – VIR

Tags: Vietnam automotive, Vietnam automotive industry, Vietnam autos market, Vietnam car imports

Posted by VBN on May 25 2011. Filed under Automotive. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry