Laos spends hundreds of millions on vehicles
Laos spends hundreds of millions on vehicles
Laos spent nearly US$500 million on vehicles last year, making the landlocked country one of the potential markets for automobiles in the region.
According to the latest annual economic report from the Bank of the Lao PDR, the import value of vehicles and equipment was US$490 million in 2014, increasing from US$399 million the previous year.
Laos' spending on cars was just below the import value of consumer goods, fuels and steel, which stood at about US$1 billion, US$700 million and US$691 million respectively, according to the 2014 Annual Economic Report, which is being posted on the official website of the central bank.
The central bank produced this report as part of efforts to provide economic data for policy makers and businesses to use as reference to set up their policies and business plans.
The huge spending on vehicles was one of the indicators that the car market in Laos is growing, which will create opportunities for dealers to expand their businesses in the country.
At present, major car dealers such as Toyota, Ch evrolet, Kia and Hyundai, Isuzu, Honda, Suzuki, Landover, Mercedes, BMW, Jaguar and a number of Chinese brand names vehicles have established showro oms in large cities around the country.
Many vehicle dealers in Laos admitted that despite Laos being a small country with a population of only 6 million odd, the demand of the vehicles is growing rapidly, creating opportunities for vehicle manufacturers to expand their businesses in the country.
New Chip Xeng Vice President, Mr Saneu Chounramany told Vientiane Times recently that the company has witnessed the vehicle market in Laos growing over the past years thanks to continued economic growth.
“The vehicle market is still growing in Laos. The demand for vehicles, in particular motorbikes, has seen about 10 percent increase annually,” he said.
Allianz General Laos Deputy Managing Director, Mr Holady Volarath, said that the company was monitoring the growth of the vehicle market in Laos, aiming to use the data as a reference to setting up its insurance business plan.
He said that the number of vehicles in Laos is growing annually, reporting 1.2 million units. Of this figure, some 800,000 units are motorbikes and the rest are cars and trucks.
Car dealers said that the increase of vehicles in Laos was made possible thanks to banks and micro-finance institutes providing long term loans for Lao people to purchase vehicles, in particular sedans.
“Korean cars are one of the imported vehicles which have seen success in entering the Lao market,” said one of the car dealers on T2 road in central Vientiane.
He said that the demand for cars would remain high if there are many meg a investment projects in the country. The dealer noted that foreign investors will need to own new cars so that they can use the vehicles to facilitate and operate their businesses.
