Over recent days, some auto shops across Da Nang have been quite bustling, different from the previous quiet period due to COVID-19 impacts. Although the consumption of vehicles used for the purpose of doing business has decreased significantly due to COVID-19, individual customers’ demand for buying cars for personal use at the end of the year is still high. Following approval by the Vietnamese government, from December 1 to the end of May, 2022, a 50% cut is allowed in the registration fee for domestically- produced or assembled cars. Such a reduction is stimulating car shopping demand.

Year-end car shopping is prospered after being affected by the pandemic. Customers are seen visiting cars at the Hyundai Song Han showroom at 86 Duy Tan, Hoa Thuan Tay Ward, Hai Chau District. Photo: M.QUE

As observed at the Hyundai Song Han car showroom at 86 Duy Tan, Hoa Thuan Tay Ward, Hai Chau District on December 17, there were customers.

Mr. Nguyen Duc Linh, residing in Thanh Khe Dong Ward, Thanh Khe District said he planed to buy a car for travel at the upcoming Lunar New Year (Tet) Festival. He was mulling over which affordably-priced, highly popular car models: Hyundai Accent, Mitsubishi Xpander or Toyota Vios.

The man said that it’s high time for customers like him to by personal cars as they could get benefits and active discounts from both the price discount policies applied by sale agents and the aforementioned registration tax cut.

More than 40 domestically assembled car models, from low-cost to luxury ones, are getting benefits from the national government’s tax cut policy. With the tax cut, people can save from tens to VND100 million when making the purchases of cars.

Mr. Truong Thanh Son, General Director of Song Han Automobile Joint Stock Company, said that Hyundai's sales in the Da Nang market alone in November enjoyed an increase of about 30% as compared to October and up 6% from the same period last year. The total number of cars sold is about 220 - 230 in November, mainly such brands as Accent, Tucson and Santa Fe.

According to Son, demand for car shopping has rebounded since mid-October due to many reasons. “After the implementation of social distancing measures, people's demand for transportation has gone up, but many people preferred use their personal cars to public transport services due to their fear over the coronavirus transmission. In addition, the halving of registration fee is stimulating car sales. Last, but not least, the end of the year is still a good opportunity for people to buy cars for travel during Tet”, explained Son.

The COVID-19 wave is affecting the supply chain of the auto industry as production materials cause car prices to increase. Despite the surge in prices, domestic car manufacturers have not increased car prices amid hash competitiveness as well as a fall in people’s incomes due to COVID-19.

The automobile market prospered clearly through the data released by the Da Nang Customs Department.

Accordingly, imported cars from January 1 to December 8, 2021 were estimated at a total of about VND1,398 billion worth of value. The State budget revenue generated from this product item climbed up by VND839.4 billion over the same period in 2020.

In particular, there was sharp rise in the amount of auto parts and accessories imported by the Truong Hai Automobile Joint Stock Company alone through the Da Nang port border gate as compared to the same period last year.

The State budget revenue collected from this enterprise, as of November 30, 2021, had reached over VND1,162 billion, up VND 668.52 billion over the same period in 2020, accounting for 26.7% of the total state budget collections.

Currently, the registration fee for cars with under nine seats in most provinces and cities in Việt Nam is 10 per cent and the highest at 12 per cent in some places like Ha Noi.

After applying the new rate, buyers of domestically manufactured and assembled cars only have to pay a registration fee of between 5 per cent and 6 per cent.

Reporting by MAI QUE – Translating by A. THU