The automobile market in March: Due to price reduction, the leading position has changed

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The automobile market has started to see good growth. Photo Nguyen Ha

High growth

The most recent report by the Vietnam Automobile Manufacturers Association (VAMA) showed that the total sales of the automobile market in March reached 32,308 vehicles, an increase of 160% over the previous month and an increase of 54% compared to the same period last year. In particular, passenger car sales reached 22,528 vehicles (up 151% compared to the previous month), commercial vehicles reached 8,917 vehicles (up 170%) and specialized vehicles reached 863 vehicles (up 390%). In terms of origin, there were 12,539 CBU imported cars (164% higher than the previous month) and 19,769 locally assembled cars (up 157%).

The sales of major automakers increased sharply compared to February, of which, Thaco increased by 90%; Toyota increased 294%; Honda increased 67%; Mitsubishi increased by 515%; and Ford increased 57%. In terms of market share, Toyota led with 30.2% (9,103 cars, excluding Lexus). Next is Thaco with 26.9% market share. Honda Vietnam ranked 3rd with 9% market share.

The growth rate of the automobile market. VAMA source

Notably, Hyundai Accent (with 1,681 cars sold, growing 80% compared to the previous month) continues to dominate Hyundai Grand i10 (with sales of 1,112 cars, growing by 30.9%) to become the best-selling Korean model in Vietnam. Especially in March, Hyundai Tucson with crossover model has seen sudden growth of up to 104% compared to February, reaching 789 vehicles.This result does not take into account the sales of Hyundai Thanh Cong – the enterprise always has consumption of cars standing in the top 3 of the passenger car market in Vietnam. Information from Hyundai Thanh Cong said that this enterprise consumed 6,061 vehicles in March, up 54% compared with the previous month.

The automobile market share in March. VAMA source

Toyota Vios Marshal usurps the throne

After several consecutive months of leading, Honda CR-V has ceded the best-selling model to Toyota Vios in Vietnam. Specifically, in March 2019, Toyota Vios sold a total of 3,161 cars, while Honda CR-V only sold 1,389 cars.

Toyota Vios also defeated its direct competitor Honda City, when this model only sold 1,022 cars in March.

Thanks to promotional discounts, Toyota Vios has risen to the top of the market

During the month, Toyota Vietnam launched a promotion for Vios models. Specifically, when buying version 1.5G, customers receive 1 year of shell and body insurance from Toyota. Besides, when buying versions 1.5E MT and 1.5E CVT, the customers are given one of two gift packages: Genuine accessory package including DVD player and reversing camera or preferential interest rate for car loan at 2.99% through TFS for the first 6 months.The rise of Vios is largely due to the company's promotional discount policy as well as the agents for this model in particular and other Toyota models in general.

Not only that, many agents also apply their own programs like in March when buying Vios, the customers get direct discounts of 30-35 million VND depending on the version.

Not only Vios, TMV also applies the promotions for a variety of models including Innova, Corolla Altis and Wigo MT.

In addition, the growth of Vios comes from the overall growth of the market because in fact, many models achieved good growth in March.

For example, though far behind Vios, Honda CR-V also gained 236.3% compared to the same period last year; Toyota Wigo also had an impressive reappearance after months of being knocked out of the list and also leading the segment of small urban cars. Along with that, the return of Toyota Innova was also remarkable when it sold 1,712 units, up 16.5% over the same period last year.

Pickup trucks continue to wobble

In 2018, the pickup truck segment had a decrease when the supply was unstable. In the first 2 months of 2019, the pickup truck models continued a downward trend.

In March, there was a change in policy regarding registration fee payment for pickup trucks. Accordingly, the fee for pickup trucks increased three times compared to the previous level. The time of application was from April 10 and this information has significantly affected customers’ psychology.

In order to "run" before the effective registration fee, the demand for pickup trucks increased compared to the previous month, but because the supply did not meet demand, the growth rate is not high.

In particular, there were 1,946 pickup trucks sold in March, up 1,025 vehicles from the gloomy February. The models all grew slightly such as the Ford Ranger increased by nearly 50 cars, Toyota Hilux increased by nearly 190 cars, Mitsubishi Triton increased by 145 cars, and even the "bottom" Isuzu D-Max pickup truck model also sold 57 cars (last month selling only 8 cars).

Especially thanks to good supply, the Japanese pickup truck, Mazda BT-50 achieved a good growth rate of 450 cars, an increase of nearly 330 cars compared to February.

While the pickup truck segment wobbles, the Ford Ranger still led the segment. Photo Nguyen Ha

Price reductions, good growth

However, it will be difficult to get a good growth rate in April if the companies do not apply customer support policies because the new registration fee takes effect from April 10.

The automotive market is expected to continue to grow in April thanks to increasing demand of customers, while firms and agents have been applying discounts and promotions simultaneously. Currently, many models have been in deep decline.

For example: the domestically-assembled Toyota Camry has been reduced simultaneously from 55-65 million compared to the list price. Toyota models such as Vios are discounted by agents from 30-35 million VND depending on the version, Innova currently has a preferential rate of 30-40 million VND. Corolla Altis also reduces 35-60 million VND. Especially, Toyota Hiace has a record reduction of over 150 million VND.

Many models are being discounted heavily in the market.

BMW models are also discounted by up to 100 million thanks to the policy of supporting registration fees up to 50% (BMW 320i, 218i, 118i models) with 1 year of automobile material insurance. Chevrolet Trailblazer has received a discount policy of 30-50 million VND/car. Isuzu D-Max reduces its price strongly from 51-70 million VND depending on the version. Mitsubishi Outlander is discounted 15.5-51.5 million VND by the distributors. The Ford EcoSport is reduced by about 40 million VND. Models of Nissan Vietnam such as Sunny, X-Trail, Navara, Terra are reduced by up to 30 million VND and offer accessories such as bodykit, floor mats, AVN headsets or cruise cameras.

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Mazda CX-5 gets the most special incentives up to 32 million VND for three versions 2.0L, 2.5L 2WD and 2.5L AWD. In addition, the customers buying the cars will get extra insulation film accessories, baga convertible (roof rack), LED fog lamps, floor mats and rescue bags. Mazda 3 is reduced by 25 million VND/car, and Mazda 6 is reduced to 35 million VND/car.

Along with that, the market will also have many new models, including the Honda Civic 2019, Toyota Camry 2019 and Honda Brio.