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Car imports drop by more than 50%
2010-1129
Imports of completely-built unit (CBU) cars in November dropped by more
than 50 per cent compared to the same month last year. This was because
of the rising dollar and a proposal to lower tax on cars imported from
ASEAN nations.
Roughly 4,000 cars worth US$72 million were imported, against 11,500 units worth a total of $159 million in November last year.
Imports in the first 11 months of the year reached 46,000 units worth a total of $836 million, down 34.2 per cent in volume and 22.4 per cent in value over the same period last year.
Industry insiders said that in previous years, car imports often sharply increased at the end of the year as demand increased before Lunar New Year (Tet).
They said the decrease was expected in the wake of Government measures to restrict the trade deficit.
This had led to an increase in the value of the dollar against the dong and a shortage of the greenback in the domestic market.
Nguyen Van Sang, a salesman at Ngoc Anh auto showroom in Ha Noi's Nguyen Dang Ninh Street, estimated customers had to pay additional tens of million of dong per car because of the weak of the dong.
The unofficial exchange rate has hit more than VND21,000 to the dollar compared to a little over VND19,000 two months ago.
Insiders said if the dollar remained high, car imports would continue to fall into the new year.
Sang said the number of imported cars sold at most showrooms for the past two months declined by roughly half over the same period last year, adding that his showroom sold only three to four cars daily compared to about 10 last year.
A proposal by the Ministry of Finance to slash import tariffs on cars from early 2011 has also had a negative effect on sales because many buyers are prepared to wait.
Vu Van Truong, director of the ministry's tax policy department, said the ministry planned to reduce the tax rate on cars with less than nine seats imported from ASEAN countries from 83 per cent to 70 per cent. Tax on imported cars from outside the region will remain at 83 per cent in 2011.
Roughly 4,000 cars worth US$72 million were imported, against 11,500 units worth a total of $159 million in November last year.
Imports in the first 11 months of the year reached 46,000 units worth a total of $836 million, down 34.2 per cent in volume and 22.4 per cent in value over the same period last year.
Industry insiders said that in previous years, car imports often sharply increased at the end of the year as demand increased before Lunar New Year (Tet).
They said the decrease was expected in the wake of Government measures to restrict the trade deficit.
This had led to an increase in the value of the dollar against the dong and a shortage of the greenback in the domestic market.
Nguyen Van Sang, a salesman at Ngoc Anh auto showroom in Ha Noi's Nguyen Dang Ninh Street, estimated customers had to pay additional tens of million of dong per car because of the weak of the dong.
The unofficial exchange rate has hit more than VND21,000 to the dollar compared to a little over VND19,000 two months ago.
Insiders said if the dollar remained high, car imports would continue to fall into the new year.
Sang said the number of imported cars sold at most showrooms for the past two months declined by roughly half over the same period last year, adding that his showroom sold only three to four cars daily compared to about 10 last year.
A proposal by the Ministry of Finance to slash import tariffs on cars from early 2011 has also had a negative effect on sales because many buyers are prepared to wait.
Vu Van Truong, director of the ministry's tax policy department, said the ministry planned to reduce the tax rate on cars with less than nine seats imported from ASEAN countries from 83 per cent to 70 per cent. Tax on imported cars from outside the region will remain at 83 per cent in 2011.
Source: VNS
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