Vehicles and Fuel - An Important Market

Professor Associate and Dr Phan Dang Tuat, director of the Industrial Strategy Institute, the Ministry of Industry, said that the Vietnamese automobile and motorbike industry was a spearhead economic sector of hi-tech. Alongside the oil and gas industry, the manufacturing and assembly of vehicles are producing positive impacts on Vietnam’s social life and economic growth.

In fact, the Vietnamese automobile industry remains immature. In the 1994-1996 period, 14 licences on automobile trading and assembly were granted to foreign investors. Great benefits of Vietnamese and foreign investors in the local automobile industry imply that Vietnam will become an attractive investment destination for investors.

 

The Vietnamese Government has created suitable conditions for the development of the automobile market. In major cities, many projects have been carried out to develop traffic infrastructure facilities with suburban roads and bridges.

However, the Vietnamese market hopes to receive hi-tech and safe products at reasonable prices. Therefore, the Ministry of Industry and the Vietnamese public wish that all foreign-invested enterprises will observe well the Vietnamese and international standards when they invest in Vietnam.

 

The Vietnamese motorbike market accounts for eight per cent of the world market, based on the number of motorbikes in use. The market growth rate is between 20 and 25 per cent. The annual output is registered at 1.7 million units in the 2005-2010 period, with every six people having a motorbike.

 

According to statistics by the Ministry of Industry, Vietnam has 52 motorbike manufacturing and assembly enterprises, including 22 State-owned and seven foreign-invested companies. To develop an export-orientated industry, local manufacturing and assembly enterprises should join their efforts to build and develop trademarks for Vietnamese motorbikes. 

 

The boom of motorbike and automobile industry has created more favourable conditions for those enterprises specialising in manufacturing and supplying spare parts and accessories. To increase the use of locally-made spare parts and accessories and meet the requirement for quality, investment in the support industry should be made in a close co-operation with the local manufacturing and assembly enterprises. In its draft plan for the support industry, submitted to the Government by the Ministry of Industry, many priority policies on tax and export and the establishment of an investment fund are mentioned.

 

Vietnam is the third largest oil production in Southeast Asia, just behind Indonesia and Malaysia, and ranks 30^th in the world. So far, PetroVietnam has signed around 50 contracts with foreign partners, including Shell, Total, BP, Conoco Phillip, Cheveron-Textaco Caltex and Unocal. PetroVietnam has found solutions to continue to attract foreign investment to offshore exploration and exploitation of oil and gas. PetroVietnam has sought opportunities to invest in oil and gas exploration and exploitation in different parts of the world.