As June begins, automakers in Vietnam continue to race to offer discounts in a bid to offload unsold inventory, with industry forecasts suggesting the local auto market will continue to face significant challenges in stimulating consumer demand.

According to the Vietnam Automobile Manufacturers Association (VAMA), the automotive sector showed signs of recovery in early 2025. However, current sales figures still fall short of reflecting actual market demand.

Automakers roll out aggressive promotions amid weak demand

The sluggish car market throughout 2024 has led to a build-up of unsold vehicles. In response, automakers are continuing or expanding their promotional campaigns, even after the government’s 50% vehicle registration fee incentive ended in late 2024.

In June 2025, popular car brands launched a flurry of promotions. Toyota is covering 50% of registration fees for models like the Vios, Yaris Cross, and Corolla Cross, while offering full (100%) fee coverage for the Veloz and Avanza. Honda is offering similar 50% support for select versions of its City, Civic, CR-V, BR-V, and HR-V models.

Another Japanese brand, Mitsubishi, is heavily discounting its key models, the Xpander and Xforce, by covering half of the registration fees and offering fuel vouchers worth over 20 million VND (about USD 785).

Nissan, Ford, and Hyundai are also joining the promotional push. Nissan is offering between 50% and 100% registration fee support for the Almera and Navara. Ford is fully covering the fees for the Ranger and Territory, and is also holding a lucky draw with prizes worth up to 100 million VND (approximately USD 3,920).

Hyundai, grappling with steep sales declines since early 2025, is offering its highest incentives yet, including 100% fee waivers for many 2024 VIN models, with deals running from March through June.

Dealers face tough sales targets amid empty showrooms

Despite these stimulus campaigns, car dealerships are under tremendous pressure from high sales targets and unsold inventory. Many showrooms are seeing little customer traffic, and numerous new sales staff have had to quit due to poor performance.

“Car prices have never been this low. They're extremely attractive right now, but customer turnout is still sparse. Sometimes we just sit and chat to pass the time,” said Xuan Quy, a sales consultant for a Korean car brand in Hanoi. “Veteran staff who have built up a base of regular customers are hanging on, mostly by focusing on online sales channels.”

This situation is not unique. Pham Hai, a staff member at a Honda dealership in Hanoi, said the market has become fragmented due to the arrival of new brands. At the same time, customer sentiment remains cautious due to economic uncertainty and unclear macroeconomic policies.

In reality, quiet showrooms and desperate sales staff are now a common scene across Vietnam's car dealerships.

Oversupply shifts burden to dealerships

Auto experts believe total market supply still far outpaces actual demand. A clear sign is the significant volume of unsold 2023 and 2024 models that manufacturers have yet to move.

Newly released models without aggressive discounts are already tough to sell. The existence of older, heavily discounted vehicles makes it even harder, increasing pressure on dealerships.

As a result, many dealers are being forced to absorb losses by launching their own discount campaigns in addition to those from automakers. These self-funded programs are seen as critical to staying afloat in this highly competitive market.

With a combination of factory and dealer promotions, car buyers can currently save anywhere from a few hundred to several thousand dollars. However, the broader recovery of the auto market remains elusive, as consumers remain hesitant and increasingly prefer financial investments over major purchases like personal vehicles amid an uncertain economy.

Ngo Minh