Automakers warn of weaker conditions

Automobile manufacturers and assemblers are warning that removing mandatory business conditions could create unfair competition between domestic producers and vehicle importers, potentially weakening Vietnam's long-term industrial development strategy.

- By Nguyen Thu

As the Vietnamese Ministry of Finance drafts plans to cut and simplify business conditions, including a proposal to remove automobile manufacturing, assembly, and import from the list of conditional business sectors, major domestic carmakers are urging caution over the potential consequences for Vietnam's automotive industry.

Truong Hai Auto Corporation (THACO), VinFast, and TC Group last week warned that the proposal may undermine incentives for localisation and reduce the competitiveness of enterprises that have invested in domestic production capacity.

THACO argued that reducing investment and business conditions in the automotive sector is inappropriate given the industry's strategic role in the economy. According to the company, vehicle manufacturing is a foundational industry with strong spillover effects across supporting sectors, while also directly affecting public safety, health, and the environment.

"Automobiles are products with extremely high safety and quality requirements. Consumers need to be assured that manufacturers and distributors have sufficient capacity for warranty services, maintenance, spare parts supply, and product recalls," a representative said. "Requirements related to factories, production lines, and after-sales facilities should not be viewed as administrative barriers, but as essential conditions to ensure product quality and manufacturer responsibility throughout a vehicle's lifecycle."

VinFast expressed similar concerns, saying that technical and infrastructure requirements reflect the seriousness and long-term commitment of manufacturers investing in Vietnam. The company also called for retaining administrative procedures governing production and imports to prevent unqualified firms from entering the market.