Industry News
Vietnamese car industry: 50 OEMs but only 60 domestic suppliers
4th September 2006
Within the past ten years, Vietnam has seen the appearance of 60 car parts producers with total assets of 1,200 billion Vietnamese dollars. However, while the number of components producers has grown slowly, the number of vehicle assemblers has increased rapidly. Vietnam is now home to 50 car assemblers and the figure is expected to increase further, although the global standard ratio of 20 domestic suppliers per assembly plant is nowhere near being achieved there.
Toyota and Ford, the largest automobile manufacturers in Vietnam, have only two or three local suppliers.
Local OEMs believe that the small scale of the market, and of most local OEMs’ output, is the main hindrance to drawing investment for supporting industries. Currently, the Vietnamese market is running at around 40,000 units a year, and the Vietnamese government has not put in place local content incentives or regulations such as Thailand’s, where vehicles have 70-80% local content, compared to Vietnam’s 5-6%.
(english.vietnamnet.vn/biz, 1 September)
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