Vietnam Used Car Market is expected to expand at a CAGR of ~10.6% in terms of Gross Transaction Value in between 2021-2026: Ken Research

Government initiatives to ban motorbikes by 2030 and improved road condition to curb traffic congestion will act as a catalyst for the shift in consumer preference from two wheelers to four wheelers.
The preference towards used vehicles is expected to surge rapidly due to its lower price compared to their newer counterparts which is favorable to the fast growing middle class population in Vietnam.
Digital is the Future

Entities operating in Vietnam Used Car Industry are enhancing their digital presence to increase their online visibility among consumers. The era of COVID-19 witnessed consumer's shifting preference in utilizing online platforms for their purchases compared to the traditional method of physical visits. Thereby, dealerships network is leveraging the opportunity to extend information to customers through their social media platform and collaboration with classified platforms.

Shift in Consumer Preference towards availing Private Transportation Medium

Due to the increased awareness on health and hygiene followed by the advent of COVID-19, consumers are preferring availing private transportation compared to public transport medium. Passenger vehicle sales in Vietnam is expected to expand at a CAGR of ~17.6% in between 2021 and 2026. Rapid urbanization in coming years in northern and southern region of country especially in cities such as Ho Chi Minh and Hanoi for better employment opportunity and increased financial stability will contribute in consumer's adaptation to four wheeler vehicles compared the predominant motorbike usage.

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Vietnam Used Car Market Competition

Improved Road Condition and Ban on Motorbikes by 2030

Historically, motorbikes have been the predominant medium of transportation in Vietnam attributed to its flexibility and affordability. However, government initiative to ban motorbikes in 2030 in Hanoi is going to contribute to the shift in consumer preference towards availing four wheeler vehicles. Weak road condition in Vietnam has been a challenge which negatively impacts the traffic condition in the country. With recent policies by the government to improve road infrastructure facilities to curb traffic congestion, preference towards passenger vehicles is expected to witness a boost. Further, the government of Vietnam has proposed a regulation wherein import of used vehicles older than 5 years has been discontinued which is expected to boost the sales of domestically produced used vehicles.

Fast Growing Middle Class Population and Growth in Disposable Income

GDP per capita of Vietnam in 2020 stood at USD 2,785, which is expected to gradually rise and attain the status of fastest growing economy in the ASEAN region by the end of 2022. The rise in disposable income of consumers is enabling them to purchase passenger vehicles. However, due to lack of infrastructural ability and possible cause of wear & tear, the depreciation rate of newer vehicles in the first 3 years is high, which serve as an opportunity for the used car market to integrate in future. Over the coming decade, an addition of 23.2 million people to the middle class of Vietnam is expected, taking the population of middle-class people in the country to about 56 million people by the year 2030. Rapid urbanization in the region complements the demography change as consumers are shifting to urban cities for better job opportunities. Increasing financial stability of consumers will lead them in availing private medium of transportation for better convenience compared to public transportation.

Support from Automobile Financing Entities

Financial entities extending support to provide credit to customer's willing to avail private transportation medium will shape the Vietnamese Used Car Market. It is estimated that in between 2021 and 2025, total credit loans disbursed will expand at a CAGR of ~17%. Financing facilities helps the middle class population in availing immediate loan for automotive purchases. Banking institutions, NBFCs and Captive Companies are the major entities which contributes in providing financial support to the customer. In 2025, it is estimated that banks would dominate the auto-financing market due to the lower interest rate charged compared to NBFCs or captive dealers.

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The publication titled "Vietnam Used Car Market Outlook to 2026 (Second Edition): Driven by growing disposable income and shifting consumer preference from two-wheelers to four-wheelers" covers the overview of used car industry by analyzing historical statistics and corresponding developments in the used car market. Reduction of import tax to 0% for cars imported from ASEAN region, free trade agreements signed with European Union and support to the domestic automotive industry have subsequently deterring the growth of used car market post 2018. However, initiatives such as ban on motorbikes, fast growing middle class population and affordability of used vehicles is expected to contribute to the surging growth of the industry in coming years. Given the fragmented completion structure in the used car market, analysts have elaborated on competitive landscape of major captive dealers, multiband dealers and classified platforms on the basis of services offered and operational parameters. The report also covers a snapshot on online and offline used car business model, value chain analysis, growth drivers, buying decision parameters, business model, SWOT analysis, impact of COVID-19 and risk factors governing the future outlook of industry.

The report also provides comprehensive insight on the market size and segmentation of the industry. Further, the report covers overview of the supporting industries such as auto-finance, aftersales and spare parts industry on the basis of market size. The report highlights the pain points of the auto-finance market along with detailed company profiles of major banking institutions and NBFCs. The report concludes with projections for future industry market size, market segmentations and analyst take on future market scenario.

Key Segments Covered in Vietnam Used Car Industry:-

Vietnam Used Car Market

By Type of Vehicle

Sedans
SUVs
MPVs
Hatchbacks
Others
By Vehicle Age

0-3 years
3-5 years
5-7 ears
More than 7 years
By Region

Northern
Central
Southern
By Price

VND 0-200 Million
VND 200-400 Million
VND 400-600 Million
More than VND 800 Million

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By Vehicle Brand

Toyota
Ford
Kia
Honda
Hyundai
Others
By Channel Purchase

Organized Purchase
Non-Organized Purchase
By Financed vs Non-Financed

Vietnam Auto-Finance Market and Auto Insurance Market

Total Car Loans Disbursed
Total Outstanding Loans
Auto-Insurance Market on the basis of Gross Premium
Key Target Audience

Captive Dealers
Multibrand Dealers
Classified Players
Banks, and NBFCs providing Financing Facilities
Automotive Companies
Government Bodies
Time Period Captured in the Report:-

Historical Period: 2015-2021
Forecast Period: 2021-2026F
Key Topics Covered in the Report:-

Vietnam Used Car Industry Research Report
Overview of Vietnam Used Car Market
Ecosystem of Vietnam Used Car Industry
Vietnam Used Car Online and Offline Business Model
Growth Drivers and Challenges to Vietnam Used Car Market
Industry trends and developments
Rules and Regulations by Government Bodies
Impact of COVID-19 and Future Outlook of Industry
Porter 5 Forces Analysis of Vietnam Used Car Industry
SWOT Analysis of Vietnam Used Car Industry
Buying Decision Parameters of Consumer's
Overview of Auto-Finance and Auto-Insurance Market in Vietnam
Overview of Aftermarket Services Industry in Vietnam
Overview of Spare Parts Industry in Vietnam

Related Reports:-
https://www.kenresearch.com/automotive-transportation-and-warehousing/automotive-and-automotive-components/malaysia-used-car-market-outlook-to-2025/472827-100.html

https://www.kenresearch.com/automotive-transportation-and-warehousing/automotive-and-automotive-components/philippines-used-car-market-outlook-to-2026/524038-100.html

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