Document No. 2506/VPCP-CN dated 21/4/2022 of the Office of the Government conveys the comments of Deputy Prime Minister Le Van Thanh on the proposal of strategic research of the automobile industry according to world trends.

Previously, the Vietnam Automobile Manufacturers Association (VAMA) sent a letter to Deputy Prime Minister Le Van Thanh on the proposal of Vietnam’s Automobile Industry Strategy according to world trends and contributing to the implementation of Vietnam’s commitment at COP26.

With the desire to build an increasingly large automotive industry in Vietnam and make a significant contribution to the economy, while also following the technological trends and the transformation of the automotive industry in the world, VAMA proposes to exchange the following contents: The development program of electric cars and the transition from gasoline, oil to electric vehicles, the action program to implement the COP26 commitment; recommendations on difficulties in the process of implementing the provisions of the Law on Environmental Protection related to end-of-life products and recycling processes; propose policies to promote the market, expand the production of automobiles and auxiliary industries in the country.

In this regard, Deputy Prime Minister Le Van Thanh assigned the Minister of Industry and Trade to meet and discuss the proposals and recommendations of VAMA to have asynchronous solution to develop the Vietnamese automobile industry according to its assigned functions and tasks; report to the Prime Minister on matters beyond its competence.

According to statistics from the Department of Industry (Ministry of Industry and Trade), by the end of 2020, Vietnam’s automobile industry has more than 40 enterprises manufacturing and assembling cars including cars, trucks, passenger cars, specialized cars and close-knit cars. Some domestic enterprises have actively participated in the global automobile production chain. Tổng công suất lắp ráp theo thiết kế khoảng 755 nghìn xe/năm, trong đó khu vực có vốn đầu tư nước ngoài chiếm khoảng 35%, doanh nghiệp trong nước chiếm khoảng 65%.

However, the Department of Industry also highlights the limitation of the Vietnamese automotive industry that it has only recently participated in the low segment of the automotive value chain, which depends largely on the production assignment of global automobile corporations, which have not mastered core technologies such as engines, control systems, transmission systems. Moreover, the domestic automobile manufacturing and assembly industry has not yet met the criteria of the real automobile manufacturing industry. The price of cars is still high compared to other countries in the region.

In particular, regarding electric cars, the Industrial Department said that apart from VinFast is conducting the production and assembly of electric vehicles, no domestic enterprises have participated.

VinFast also said it will stop the production of gasoline vehicles by the end of 2022, boosting the development of electric cars in the domestic, US and European markets. This is a “move” that is judged to be quite daring because the difficulties ahead are certainly not going to be small.

Source: VN Business