Vietnamese consumers increasingly favor multi-purpose family cars

39,442 seven-seater MPVs were sold in 2019, accounting for 17 percent of total sales of passenger cars in Vietnam last year, Vietnam Automobile Manufacturers Association (VAMA) stated in its latest report.

This is an increase of 112 percent over sales of the same segment in 2018, and almost three times higher than the 2015-2018 average of 14,652 small-sized MPVs sold per year.

A major driver of demand for these small-sized MPVs, most of which cost less than VND1 billion ($43,000), had been the boom of ride-hailing services in the past five years, which urged many people to think of investing in cars to do business, the report noted.

Small-sized MPVs are the third option for most people behind the traditional sedan or hatchback, as they are more spacious, allowing drivers to carry more passengers when using them as taxis, doubling down as a family vehicle when not used for commercial purposes. Most driver do not require larger MPVs for these purposes, according to VAMA.

Small MPVs also attract customers because of its low investment costs, with most banks willing to provide credit of up to 80 percent of the vehicle price with different credit purchase schemes, it said.

According to the report, the leading model in this segment last year was the Mitsubishi Xpander, accounting for 51 percent of small-sized MPVs sold. It was followed by the Toyota Innova with 31 percent, and the Toyota Rush at 7.5 percent.

Competition in this segment is expected to heat up this year with Japanese automaker Suzuki having just introduced the XL7, a new MPV model, last week.

Japan’s Mitsubishi is also expected to release a new MPV model called Xpander Cross this year, which would bring the number of models competing for the family car segment to eight, double the number available in 2015, VAMA said.

A total 229,706 passenger cars were sold in 2019, up 19.6 percent over the previous year, it added.