CBU automobile imports skyrocket
CBU automobile imports skyrocket
Vietnam imported 142,000 completely-built-up (CBU) cars worth US$3.1 billion last year, soaring 71% in volume and 69.4% in value over 2018, according to the General Department of Vietnam Customs.
In December last year alone, the country spent US$140 million on 8,000 CBU automobile imports, news site Mot The Gioi reported.
For automotive accessories too, import turnover surged by over US$600 million to reach US$4.1 billion. These accessories were mainly bought from South Korea, China, Thailand, Japan and Germany.
According to experts, the demand for CBU automobiles with fewer than nine seats is high. Moreover, some car lines are entitled to special consumption tax reductions.
A representative of the General Department of Vietnam Customs noted in 2018 that many local automobile firms had failed to meet requirements under Decree 116 on automobile manufacturing, assembly, import, maintenance and warranty services. Last year, they met these requirements, so the number of imported vehicles surged.
Despite an increase in the number of imported cars, the prices of locally assembled automobiles remain high. Many car firms have complained about the tax policies for locally assembled vehicles, hindering them from competing with imported ones.
In response, Deputy Minister of Industry and Trade Do Thang Hai pointed out that cars are subject to multiple taxes and fees. In addition, the cost of assembling automobiles locally is high.
Vietnam’s automobile market remains modest compared with that in developed countries, so locally assembled cars face fierce competition with those from Indonesia, India, Thailand and South Korea. The country has yet to introduce any large automobile firms and currently has to import materials and accessories for vehicle assembly, resulting in high selling prices for locally assembled cars.
The deputy minister stated that the Government will adjust taxes and fees for local automobile firms to ensure fair competition between imported and locally assembled vehicles.
