Reducing 50% of registration fees for domestically produced and assembled cars is a fairly effective "medicine", but the auto industry needs more sustainable measures.
Consumers "wait" for policies as a habit
The problem of reduction registration fee for domestically produced and assembled cars has always been of interest to people in the past 2 months. Manufacturing enterprises car also looking forward to the policy of reducing registration fees so that they can cut down on the promotional programs that they have to constantly "shoulder".
In the first 6 months of this year, total car sales in the market decreased by about 2% compared to the same period last year, 10% lower than the same period in 2019. Notably, car assembly plants in Vietnam are only operating at 40% capacity in the first half of 2024.
Popular and luxury brands are all setting up factories in Vietnam, typically Toyota, Honda, Mitsubishi, Mercedes-Benz, BMW, Peugeot. Therefore, if policy makers in Vietnam do not take timely measures to protect the automobile industry, the current decline in output will become extremely dangerous.
Looking at Thailand, Japanese automakers have had to close a number of factories from July 2023 to June 2024, causing about 50,000 people to lose their jobs, seriously affecting the socio-economic situation.
Currently, some opinions say that reducing registration fees for domestically assembled cars will affect fairness for imported cars. However, in January 2023, the Vietnamese Government extended the 0% tax period for cars imported from ASEAN countries for another 5 years, that is, until the end of 2027.
Meanwhile, for cars imported from Europe, according to information posted on the homepage of the World Trade Organization (WTO) in Vietnam, in 2024, the import tax rate on cars from the EU to Vietnam will decrease, the highest being only 42.5%. The price of many luxury car models will continue to decrease by up to 80 million VND compared to 2023.
Thus, it can be affirmed that Vietnam has policies to create favorable conditions for all imported cars from abroad, helping them to compete directly with domestically produced cars.
At the same time, many opinions say that reducing registration fees for domestically assembled cars is to promote the use of internal combustion engine vehicles, which goes against the Vietnamese Government's international commitment to reducing emissions, but this opinion is completely unfounded because Vietnam has a clear roadmap for reducing emissions.
Dr. Le Huy Khoi, Deputy Director of the Institute for Strategy and Policy Research on Industry and Trade (Ministry of Industry and Trade) pointed out that: In the period from 2023 to 2030, internal combustion engine vehicles will continue to play a major role and account for a large proportion in both production, consumption and export.
Associate Professor Dr. Dinh Trong Thinh shared: Reducing car registration fees is one of the measures that we have implemented over the years and it has had a good effect on the consumption of domestically produced and assembled cars.
With the above arguments, the reduction of registration fees for domestically produced and assembled cars in the coming time is still considered practical and timely in the current context, although the Vietnamese Government has previously applied this policy three times. This is considered a "medicine" to help the automobile manufacturing industry stabilize output, contributing to increasing the Gross Domestic Product (GDP).
Need a long-term, sustainable policy
In order for the Vietnamese auto industry to have a "strong body", it is certainly impossible to abuse "medicines" that have short-term effects.
Reducing registration fees is necessary but cannot completely change the difficulties of the domestic automobile assembly industry. In the long term, the Government needs to continue to have policies to increase the localization rate, encourage investment in the automobile support industry to increase the production of domestic components. In particular, policies on special consumption tax will help reduce the cost of automobile production, promote a more vibrant and sustainable market than temporary policies.
According to data from the Department of Industry (Ministry of Industry and Trade), Vietnamese enterprises have only produced and processed less than 300 parts, while a whole car has about 30,000 parts and components. And the technology content and value of these parts and components are not high, they are still only simple, labor-intensive parts such as seats, wheel rims, door panels. Meanwhile, the remaining parts are mainly imported, making production costs higher.
Therefore, promoting supporting industries is extremely important. And in the coming time, in addition to reducing registration fees for domestically manufactured and assembled cars, policy makers need to continue to urgently study and adjust policies on taxes, fees, and charges in a preferential direction, supporting the localization value ratio for this product line.
Source
Comment (0)