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50,000 automobiles per 12 months is the minimal manufacturing stage wanted for the expansion of the Vietnamese auto half business. Sadly, few automotive producers in Viet Nam have reached such a stage.
Solely Toyota and Hyundai crossed the brink in 2021, with 64,172 and 56,028 automobiles, respectively.
In the meantime, Kia fell in need of the brink with simply 35,181 automobiles. VinFast adopted with 34,746 and Mitsubishi with 26,346.
Truong Thi Chi Binh, an skilled at Vietnam Institute of Technique and Coverage for Trade and Commerce, underlined the low stage of automotive manufacturing as a setback for the Vietnamese auto half business.
She mentioned low manufacturing meant low demand for home auto components, discouraging suppliers from investing in new manufacturing strains.
With out new manufacturing strains, the suppliers change into much less aggressive in value as they can’t obtain economies of scale.
Consequently, automotive producers have to seek out their auto components elsewhere.
“Since auto manufacturing is inadequate to encourage home auto components manufacturing, many automotive producers haven’t any selection however to import their inputs,” Binh mentioned.
The skilled believes that Viet Nam ought to introduce beneficial insurance policies to spice up the expansion of the home business.
In any other case, Vietnamese suppliers might be priced out of the market by overseas rivals.
The final director of a Japanese auto producer shared the view. He identified that automotive components costs in Viet Nam are two to 3 instances increased than these in different regional nations.
Auto producers in Thailand buy simply 10 per cent of automotive components from overseas. They get the remaining from round 3,000 Thai suppliers.
In the meantime, auto producers in Viet Nam must import 80-85 per cent of automotive components, successfully lowering the variety of Vietnamese suppliers to round 300.
The final director known as for extra beneficial insurance policies to encourage home manufacturing of auto components, significantly medium-sized metal and plastic components.
Two consultants on the College of Economics, Vinh College, revealed that on common, an auto producer buys automotive components from two home suppliers.
With over 90 per cent of suppliers in Viet Nam being FDI companies, Vietnamese companies take up a minority.
In keeping with the Vietnam Register, 318,704 vehicles had been bought and registered in Viet Nam in 2021, increased than the figures in 2020 (296,634) however decrease than in 2019 (322,322).
bizhub
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