Automotive industry in Vietnam

All currently produced models are designed abroad by foreign brands, and many rely on knock-down kit production.

Due to high import taxes on automobiles, the Vietnamese government protects domestic manufacturing.

Although Vietnam is a member of the ASEAN Free Trade Area, automobile imports fall under an exception.

[citation needed] As of April 2018, 85% of car sales in Vietnam were produced domestically from knock-down kits.

[2] Before Đổi Mới, automobile ownership in Vietnam was limited, and the vehicles present were imported from Second World countries that were more politically aligned with the government.

In 1995, the first automobile factories were built, using knock-down kits to produce vehicles, starting with Mitsubishi, Toyota, and Isuzu.

[3] The Vietnamese car market is relatively small, albeit the fastest growing in Southeast Asia.

[6] In 2018, the share of locally produced parts in the Vietnamese automotive industry was just 10%, compared to up to 80% in Thailand and Indonesia.

For small cars with less than nine seats and 1.5-litre engines or smaller, it adds an extra 35 percent to the price.

Hyundai reportedly strongly considered building a manufacturing plant in Ninh Binh, to produce the Grand i10 model.

[19] Suzuki builds cars in Vietnam through its Visuco subsidiary, operating in a factory in Bien Hoa, Dong Nai Province.

[24] Daimler AG assembles various Mercedes-Benz models from CKD kits at its factory in Ho Chi Minh City.

[31][32] In 2017, Toyota held the highest market share among passenger vehicle sales in Vietnam, at 23%.