Vietnamese fastest-growing car market In ASEAN
With a sales growth rate of 25 percent, Vietnam is the fastest-growing car market in ASEAN, while Thailand and Indonesia had a gloomy year with decreased growth. The demand brought high profits to manufacturers and dealers.
According to VAMA, 271,000 products were sold from the beginning of the year to the end of November 2016, an increase of 26 percent compared with the same period in 2015. Analysts estimate that the figure would reach 300,000 by the end of the year, which means a 25 percent growth rate over 2015.
A report of Truong Hai Automobile, a 100 percent Vietnamese-owned manufacturer, showed that its revenue by the end of the second quarter of 2016 was VND27 trillion, an increase of 51.2 percent against the same period last year.
Its post-tax profit was VND3.709 trillion, up by 17.8 percent. In the first six months of 2016, Truong Hai sold 53,100 products, up by 18,500 products, or 54 percent.
Statistics showed that Truong Hai can make a profit of VND50 million for every product sold. This, according to analysts, means that manufacturers’ profit decreased significantly compared to 2015 (VND80 million).
Truong Hai targeted revenue of VND71.315 trillion in 2016 and post-tax profit of VND8.212 trillion.
Meanwhile, the profit made by foreign invested enterprises remains a secret. However, the financial report of VEAM, a partner in the joint venture with Toyota, shows how much enterprises earn.
Toyota Vietnam in 2015 sold 52,428 products which brought profit of VND5 trillion. It is estimated that it made a profit of VND80 million for every car sold after deducting expenses.
The manufacturer’s average profit was forecast to decrease because of the sales cost increase and car price decrease.
However, as the sales continued to increase, the profit increased. Toyota Vietnam sold 50,703 products in the first 11 months, while the figure is expected to exceed 52,428 cars in 2015.
Analysts commented that manufacturers saw profit from the sale of less-than-9-seaters decreasing in 2016, but it was still high, between VND35 million and VND70 million, not including luxurious cars.
As such, with 300,000 products sold, 50 percent of which were cars, automobile manufacturers still can expect big profits in 2016.
Meanwhile, the profit from trucks tends to decrease sharply because of the lower demand, which leads to lower sales. TMT, for example, reported the sales of VND527 billion in the third quarter of 2016, a sharp fall of 40 percent if compared with the last year’s same period, while the post-tax profit decreased by 99 percent to VND500 million.
Truong Long JSC also reported the sharp fall of 42 percent in sales in the second quarter of 2016.
Tran Thuy, VNN