ASEAN countries to lead Vietnam’s car imports

Thailand and Indonesia are overwhelming both the volume of vehicles and the value of car imports into Vietnam in the first half of 2017.

According to the General Department of Customs, Vietnam imported a total of 48,354 completely-built-up (CBU) auto cars worth more than US$966 million in the first half this year.

In the past six months, CBU cars imported from Thailand reached 19,170 units worth approximately US$347 million.

Indonesia, after a period of rapid acceleration, has narrowed the gap with Thailand. According to statistics of the General Department of Customs, a total of 10,484 CBUs imported from the island country in the first six months of the year reached a turnover of more than US$184 million.

Total CBU auto imports from the two countries therefore stood at 29,654 units, worth more than US$531 million and accounting for more than half of such imports in both volume and value.

The first and most important advantage is that import tariffs are significantly lower than CBU imported from other countries, including those from the most-favored-nation of the WTO (MFN) or ASEAN (ASEAN+) such as South Korea, Japan or China.

The second advantage is the geographical distance and the procedures for finalizing import and export contracts. Being in the Southeast Asia and members of ASEAN Community as well as ASEAN Trade in Goods Agreement (ATIGA) help these countries reduce cost and time for exporting cars.

For example, imported cars from Europe or the US can take at least three months, while imports from Thailand and Indonesia only take 30 days.

According to the ATIGA tariff reduction schedule, tariffs on imported CBUs from ASEAN countries will be 0% from January 1, 2018.