Vietnam auto market 2025: opportunity for electric vehicles and MPVs to explode

The Vietnamese auto market was almost paralyzed in the first half of 2024, but thanks to the incentives of manufacturers and the Government's support measures through preferential registration fees for assembled cars, sales grew by 22% compared to 2023.

Members of the Vietnam Automobile Manufacturers Association (VAMA) and importers Hyundai Thanh Cong and VinFast will achieve total sales of 494,310 vehicles in 2024, equivalent to 1,354 vehicles sold per day, 56 vehicles per hour and nearly one vehicle per minute.

In a year of many difficulties, sales of key brands in the market such as Toyota, Ford, Mitsubishi, VinFast... all grew. Hyundai, a brand with many new products transferring their life cycle in 2024, but car sales only decreased slightly by 2%.

From the above factors, although experts do not believe in a booming year for the Vietnamese auto market in 2025, they still expect positive signs. In particular, competition between new and old car manufacturers will stimulate the market.

Growth returns

"Automotive industry sales in 2025 will improve compared to 2024, but there will be no breakthrough yet," said Nguyen Trung Hieu, an expert from the policy subcommittee (VAMA). "After two years of sacrificing many things to maintain competitiveness in terms of market share, it is time for many companies to reconsider their strategies to prioritize long-term development."

According to sales experts, 2023 can be considered the "bottom" of the overall growth picture of the entire industry after the boom in 2022. 2024 still has the echoes of the difficulties from the previous year and the economic context has not recovered, but the demand for cars is still increasing, which is a positive signal for the market. In 2025, the psychology of tightening spending is still the main trend but will be more open than the past two years.

One factor that will make the 2025 market more vibrant is the appearance of Chinese car brands. In 2024, 7 car brands from this country, namely BYD, Aion, GAC, Omoda, Jaecoo, Geely and Zeekr, entered the market. In early 2025, another brand from China, Dongfeng, started doing business in Vietnam.

After the initial phase of getting acquainted with Vietnamese customers, these companies will have full sales in 2025. After the Lunar New Year, in February, BYD plans to launch its first plug-in hybrid model, the Sealion 6 (Song Plus). Geely's first imported Malaysian models will also be on sale. MG is preparing for the launch of the mid-size MPV G50.

In addition to Chinese brands, used car manufacturers are also stimulating the market with new products. Among them, Skoda will sell its first assembled car in Vietnam, the Kushaq. But the first is the new generation of Kodiaq. Mitsubishi said it will have an upgrade for an existing product and a completely new model in 2025. Peugeot is preparing for the appearance of the 2008 mid-life upgrade.

Top-selling car models in the market such as Mitsubishi Xforce, Xpander, Toyota Vios, Yaris Cross, Hyundai Accent, Creta, VF 5... are likely to still be the names that stir up the market and lay golden eggs for the companies.

Trend of small CUV and MPV

Over the past two years, B-class sedans have not been the most popular segment. Instead, there are CUVs and B-class MPVs, products with affordable prices and designs that are in line with the industry's high-chassis, multi-purpose trend. In 2024, out of the 10 best-selling car models on the market, 6 products belong to the high-chassis or B-class MPV segment.

The trend of favoring the two above-mentioned car lines is predicted to continue in 2025. In the MPV segment alone, the race promises to be more exciting when a series of Chinese brands have and are about to join the game. BYD M6, GAC M6 Pro, MG G50 are names that can affect the sales of MPV models with the largest market share such as Mitsubishi Xpander, Toyota Veloz. Larger size, more equipment but not much different in price are the basis for Chinese products to somewhat change the game.

"The mid-size MPV segment still has a lot of room to grow," said the sales director of a Japanese car dealership in Ho Chi Minh City, referring to the recent arrival of mid-size MPVs from China. "Competing with fewer strong rivals or creating a new customer segment is easier than taking market share from the Xpander and Veloz, which already have a solid position."

In 2025, the MPV segment will have a new model from VinFast, the Limo Green. The Vietnamese company said that the Limo Green has a three-row configuration. The car has dimensions of length, width and height of 4,730 x 1,870 x 1,690 (mm) respectively. The wheelbase is 2,840 mm. The company announced that the Limo Green uses an LFP battery, with a maximum range of 470 km after a full charge.

With the advantage of lower operating costs than gasoline cars, VinFast Limo Green can be a name that challenges many competitors in the service business segment. A-size hatchbacks, B-size sedans, and B-size MPVs running on gasoline have long been the main products used by individual customers or companies for business purposes. With Limo Green, this order can change. In addition, on the same chassis, VinFast will have a version for individual customers (white license plate), which can become a formidable opponent of gasoline-powered MPV models.

Electric vehicles expand market share

Although not as strong as in major markets around the world, electric vehicles still have a lot of room for development in Vietnam. In the Draft Strategy for the Development of the Vietnamese Automobile Industry to 2030, with a vision to 2045, the Ministry of Industry and Trade proposed that the Government assign relevant agencies to research and implement policies to reduce registration fees for battery electric vehicles (BEVs), self-charging hybrid vehicles (HEVs) and externally-charged hybrid vehicles (PHEVs).

Currently, HEV vehicles do not have any support policies. While BEV vehicles are completely exempt from registration fees, from March 1, 2025 to March 1, 2027, the fee will increase to 50% of the fee for gasoline and diesel cars with the same number of seats. This may have some impact on people's demand for electric vehicles.

VinFast is still the leader in the electric car game, but Chinese companies, especially BYD, are helping to push the competition higher. VinFast's new products in 2025 such as Minio Green in the minicar segment, Limo Green in the 7-seat MPV segment. Or Herio Green, Nerio Green in the A-SUV and C-SUV segments, targeting the service business vehicle group, promising to help customers have more choices.

With hybrid cars, Toyota is still the leader, popularizing this product line more widely in the Vietnamese market. The company currently has 6 car models with 7 hybrid versions, with sales reaching 5,350 cars in 2024, double that of 2023. After Toyota, companies such as Honda, Suzuki, Hyundai, Kia, Subaru... also contribute to diversifying players in the electric vehicle segment.