Despite sale promotion campaigns launched by manufacturers, the car market remained gloomy in the last months of the year.

The high production costs, taxes and fees all make automobile prices in Vietnam much higher than in other countries in the region.

VinFast, the automobile manufacturer belonging to Vingroup, said it is selling cars at a loss.

Vietnam’s automobile industry is small compared to regional markets and local suppliers are asking for more support from the Government.

Vietnam’s automobile industry not only has to compete with veterans Thailand and Indonesia, but also with new manufacturers in Laos, Cambodia and Myanmar.

The proportion of automobile parts made in Vietnam remains modest because of problems in production costs and quality.

Experts believe that in the immediate time, Laos and Cambodia will not be rivals on the same par with Vietnam.

In the first half of the year, the number of cars imported to Vietnam increased by 500 percent, while some models saw a sharp increase of 650 percent compared with the same period last year.

Vietnam needs to issue special policies for the automobile industry to catch up with other countries in the ASEAN region, said experts at a conference held in Hanoi on Tuesday.

If supporting industries cannot develop and automobile joint ventures continue importing car parts for assembly, Vietnam’s automobile industry will not survive after 2025, analysts say.

CBU (complete built unit) imports have been flooding the Vietnamese market while domestic factories have cut output, raising concerns among car part manufacturers that they may lose jobs.

CBU (complete built unit) imports from Thailand account for more than 50 percent of total car imports and turnover in the first eight months of the year, according to the General Department of Customs (GDC).

The Ministry of Industry and Trade (MOIT) has proposed raising luxury tax on some car models with fewer than nine seats.

Experts think the plan to spend $4.3 billion to develop the automobile industry will be in vain.

Instead of distributing Nissan products, Tan Chong Motor will assemble, import and distribute Chinese cars in the Vietnamese market.

Under the EVFTA, Vietnam will open its market to imports from EU with the preferential tariff of zero percent.

Asked about the import tariff on luxury cars from Europe after the EVFTA takes effect, the Ministry of Industry and Trade (MOIT) said the competitiveness of EU sourced cars would improve.

There are two clear investment tendencies in the automobile industry. First, becoming the leading assembling center in Southeast Asia, and second, buying technologies and making automobiles for export.

Twenty years ago, five large automobile manufacturers asked Vietnam to open the automobile market. But the proposal was refused.

When VinFast, a Vietnamnese automobile manufacturer, announced the plan to make Premium (Pre), or a low-cost product line, many Vietnamese hoped they would be able to buy cars at reasonable prices in the near future.