Vietnam car buyers disdain price tag

As the country continues to maintain its scorching growth rate, luxury cars like Porsche, Mercedes, BMW, Lexus, and Audi are no longer a rare on the streets of Ho Chi Minh City and Hanoi .

The Vietnamese economy grew at 7-8 percent annually between 2004 and 2008 and at 6.2 percent last year at the height of the global economic crisis.

Cars priced as much as VND4 billion (US$210,000) like the Porsche Cayenne S2011, BMW X6, and Mercedes S550, are shipped to the country on a regular basis, usually just a month or two after their global debut.

Once they arrive in the country, they attract taxes of 77-80 percent.

Many luxury auto makers have also set up official distributors in the country.

Audi cars have attained popularity very quickly when compared with other countries in the region, Laurent Genet, general director of Automotive Asia Co, the official distributor of Audi in Vietnam, says.

Audi’s headquarters in Germany has listed Vietnam as a priority market, even transferring 11 units of the VND1.84 billion ($94,500) Audi Q5 from the Philippines to Vietnam for immediate supply due to the high demand here.

Those who booked the car in May or later have to wait until August to get delivery, while those wanting more options have to wait for another three months.

Sales in the first half doubled over the same period last year, Tran Tan Trung, general director of Lien A International Joint Stock Co, another Audi dealer in Vietnam, said without giving the exact number.

The average age group of the buyers is 21-35, he added.

Daimler, the German makers of the super-luxury Maybach car, last year manufactured just four units of the limited edition $500,000 Maybach 62S. Two of them were bought by Vietnamese.

A $280,000 two-seater Ferrari 458 Italia was sent by air to Vietnam last year, while a customer paid VND8.4 billion ($440,300) for a Mercedes SLS Gulling AMG.

The German carmaker signed deals to sell 100 cars each worth VND1.4-4.4 billion ($73,400-230,600) at the Mercedes Fascination Motor Show held in Ho Chi Minh City last May.

Besides, it has sold 200 units of the $86,900 E250 CGI BlueEfficiency since putting it on the Vietnamese market last December.

Euro Auto, the official dealer of BMW cars in Vietnam, has 50 customers who have reserved the VND1.9-2.3 billion Series 5.

Vietnam is estimated to have imported cars and components worth $1.3 billion in the first half, 27.6 percent higher than a year earlier, the General Statistics Office said.

Complete built units accounted for $394 million, down 4.2 percent year on year.

But the government is keen to restrict imports of new cars with 16 or fewer seats and allows them to enter only through five international ports where customs norms have been tightened.

The move is aimed to controlling the trade deficit.

Vietnam has a population of 86 million and its per capita GDP reached $1,000 last year.