Excess car demand for Tet holiday drives prices up

By Thanh Nhan - Ngoc Tuan   January 25, 2019 | 05:30 pm PT
Excess car demand for Tet holiday drives prices up
Long lines of cars on Hanoi roads during rush hour are the new norm in the capital as more people ditch motorbikes for the four wheeler. Photo by VnExpress/Ngoc Thanh
The surge in demand for cars before the Lunar New Year means customers have to wait or pay extra to get immediate delivery.

With only weeks to go for the Lunar New Year Festival (Tet), which falls on February 5 this year, consumers are rushing to order automobiles leading to a shortage in the market. They either have to wait for a long time for delivery or, for quick delivery, opt for accessories which can cost an extra VND70-150 million ($3,013-6,458).  

For instance, Hyundai SUV Santa Fe requires an extra VND70-160 million ($3,013-6,887), which is 7-16.1 percent above the minimum listed price, while for the Toyota Fortuner it is VND100-150 million ($4,305-6,457). 

But most customers will have to wait until March for delivery if they signed the purchase agreement last November or later. 

The only way to get guaranteed delivery before Tet is to buy from someone who signed earlier, car dealers said, explaining that a dealership only gets around 20 units in each model per month but demand is two to three times that number. 

The shortage is because of difficulties in importing at the beginning of 2018 as a result of a new regulation tightening imports, Tran Thanh Binh, director of Thanh Binh Automobile Import Export Trading Service Co Ltd, said.

The regulation stipulates that traders are only permitted to import if they can provide valid vehicle registration certificates issued by authorities from the countries of origin.

Original quality control certificates for each vehicle and letters of authorization regarding recalls of defective vehicles from the manufacturers are also required, along with copies of quality assurance certificates provided by the countries of origin.

"This made companies stop ordering from factories in Indonesia and Thailand. The second half of 2018, however, with these difficulties resolved, businesses have started to order again. But, since the factories also produce for many other markets, Vietnam was not able to order enough," he explained.

Vietnam imported 6,362 cars, including 4,264 personal cars, 1,820 trucks in the first 15 days of 2019, according to Vietnam Customs.

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