EV market forecast to boom this year

Vietnam is experiencing a strong shift towards electric vehicles (EVs).

VinFast's electric vehicle

The supportive and preferential policies implemented by the Government, such as the exemption of registration fees and reduction in special consumption tax for EVs, have played a significant role in promoting the adoption of this type of vehicle in the country.

The number of EVs increased from 138 units in 2019 to over 28,000 EVs and 3,557 hybrid vehicles in September 2023, along with more than 2 million electric motorbikes.

The forecast for the domestic electric vehicle market to make a leap from 2024 is encouraging. With the participation of both domestic and foreign automobile manufacturers, the market is expected to expand further. VinFast, along with other automobile companies operating in the country, is gradually transitioning to electric vehicles and "green" energy-powered vehicles.

Many foreign car makers have already introduced hybrid car models to the Vietnamese market. Brands like Honda, Kia, Hyundai, BMW and Toyota have brought hybrid options such as the Honda CR-V, Kia Sorento, Hyundai Santa Fe, BMW XM, Toyota Yaris Cross, Corolla Altis and Innova Cross to the market. This diverse range of hybrid models provides consumers with more choice and contributes to the overall growth of the electric vehicle market in Vietnam.

Chinese car manufacturers are also looking to re-enter the Vietnamese market by introducing new electric and hybrid car models. These manufacturers have committed to a long-term development roadmap, including investing in manufacturing and assembly plants in the country through strategic partnerships.

The Vietnamese Government has issued regulations promoting the use of EVs to address declining air quality and promote green economic development. However, challenges such as incomplete awareness of businesses about green energy conversion, lack of charging station infrastructure, and insufficient mechanisms to encourage consumption and use of electric vehicles still exist.

According to representatives of the Vietnam Automobile Manufacturers Association (VAMA), the transition to electrified and environmentally friendly vehicles is vital. Price remains a significant factor, with electric cars generally being more expensive due to the high cost of batteries. VAMA suggests that the transition to electric vehicles should be approached in a balanced manner to avoid disrupting the market.

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