“Rising
disposable income and shifting preference of
consumers from availing public transportation to private vehicles fueled by the
impact of COVID-19 has driven the growth of Automotive Aftermarket Service
Industry in Vietnam.”
Increasing Car Ownership and Reduction of Import Tax: Vietnamese
government has proposed various
regulations since FY’18 to improve the ecosystem of the automotive industry
and making it to convenient for the consumers to purchase private vehicles by
reducing the import tax to 0% for cars imported from ASEAN region, which brings
down the price of the final product. Government initiatives to strengthen
Vietnam’s road infrastructure along with the increased awareness on health and hygiene brought about by the
advent of COVID-19 is expected to increase the prospect of vehicle ownership in
the future. There has been a gradual
surge in vehicle parcs in recent times, expanding at a CAGR of ~25.7% in
between FY’15 and FY’20. Growth of car
ownership in Vietnam stood at ~10.5% in FY’20, which was comparatively
higher than its South East Asian counterparts. Increasing car ownership acts as catalyst for the aftermarket services
industry which is expected to grow at a significant rate in coming
years.
Rapid Urbanization and
Fast Growing Middle Class: Rapid
urbanization over the years is contributing to the growth of automotive market
in Vietnam, as more and more consumers are migrating to urban cities. It is
estimated that in FY’20, the urbanization
rate stood at ~37.3% of its overall population compared to ~36.6% rate
in FY’19. Urbanization serves as one of the growth drivers for the aftermarket
service industry as consumers migrate
for better payment opportunity in the cities, it allows them to have the
financial means to avail private transport thereby increasing the prospect of
aftermarket services. To curb excessive traffic jams in the cities, Hanoi, a
major city in the Northern Region of Vietnam has proposed to ban motorcycles by 2030, thereby
enhancing the opportunity of passenger vehicle sales for the country’s fast
growing middle class in coming years.
Enhancing Online Ecosystem: Aftermarket service companies in Vietnam have not been able
to adapt to the growing significance of the online ecosystem over the years.
However, the advent of COVID-19 has changed the perception of consumers towards
the utilization of online space. More consumers are utilizing digital medium
for buying and selling products as well as booking services through online
medium. Similarly, there exist a shift in aftermarket service industry wherein
consumers are preferring to book slots for their vehicle services online.
Therefore, the automotive aftermarket service
and spare parts companies are expanding
their presence in the online space for better visibility among consumers
and compete on the basis of brand integration. Servicing companies have initiated the process of online booking
to enhance customer’s convenience. This also helps the servicing
companies to maintain COVID protocols such as curb in overcrowding in public
places as set by the Vietnamese government.
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Increased Awareness on Health and Hygiene: With the advent of
COVID-19, consumers were witnessed to be more concerned on maintaining personal
health and hygiene. Therefore they are preferring the option of private
transportation rather than availing public transport system. The change in
consumer’s behavior and preference is expected to act as an opportunity for the
automotive aftermarket service industry in Vietnam. As more and more consumers
prefer availing private transportation medium, the demand for new cars would
surge in the coming years. With the surge in the vehicle parc, consumers would
also require to periodically maintain their vehicle every 18 months as
prescribed by the government of Vietnam, thereby the demand for aftermarket
services would enhance. Therefore the future prospect of the industry looks
strong wherein OEM and multi brand workshops in the market could utilize this
opportunity to integrate the domain.
Integration of
Electric Vehicles: In order to curb the rising impact of
climate change, governments all over the world have pledged to reach zero net
carbon emissions by 2050. Hence, there is a greater deliberation of replacing fuel operated vehicles with
electric vehicles (EVs) to minimise pollution. “National Automobile Development Strategy by 2025” adopted by the
Vietnamese government aims to stimulate manufacturing and increase the volume
of use of EVs in the coming years. With the integration of EVs in the market,
vehicle service companies will have to
update their equipment's and train their mechanics for servicing electric cars
which would require huge investment by these companies thus, impacting
their business financials. Unorganized workshops will face challenge in
servicing EVs as they operate on lower
budget than required to cater to the demand of EV ecosystem.
Lack of Technological Adoption and Dependence on Imports: Domestic automotive and aftermarket
services industry has not been able to
invest in core and high end technology products such as transmission
system. Localized parts required for vehicle servicing and production are
mostly of low technology products such
as tires, mirrors, glasses, batteries and plastic products. Therefore,
aftermarket services industry in Vietnam remains largely dependent on imported components and spare parts, which
increases their cost of operating their business.
The report
titled “Vietnam
Automotive Aftermarket: OEM, Multi-brand Outlet Services and the Spare Parts
Market - Outlook to 2025: Driven by Rapid Urbanization and Growth of Vehicle
Sales; fueled by Fast Growing Middle Class population and the growing
preference for private vehicles in the post-COVID scenario” by Ken Research
suggested that the automotive aftermarket service industry in Vietnam is
expected to grow further in the near future, with the surge in vehicle parc due
to increased awareness on health and hygiene followed by the aftermath of
COVID-19, thus showcasing a change in consumer preference from availing public
transport to private transportation medium. As more consumers shift from
availing motorbikes which has historically been the dominant form of
transportation in Vietnam to availing four wheeler vehicles, the demand for
aftermarket services would increase in coming years. Rapid urbanization coupled
with fast growing middle class would act as major growth drivers for the
aftermarket service industry in Vietnam. The market is expected to register a
positive CAGR of 8% in terms of revenue during the forecast period of FY’20-FY’25E.
By Type of Workshop
OEM/Authorized
Large Multi Brand
Small/Unorganized
By Type of Vehicle Serviced
Sedan
SUV
Hatchback
Compact SUV
MPV
By Age of Car
0-3 years
3-6 years
6-9 years
9 years & above
By Region
North
Central
South
By Booking Mode
Online
Offline (including telephonic as well as Physical Booking)
By Service Split
Maintenance
Car Care
Accident Repair
Vietnam Spare Parts Aftermarket Segmentation
By Type of Spare Parts
Tires
Battery
Shocks & Struts
Oil & Lubricants
Drain Plug Gasket
Alternator & Starter
Others
Key Target Audience:-
Automotive Companies
OEM Vehicle Service Companies
Multi Brand Vehicle Service Companies
Automotive Spare Parts Companies
Government Bodies
Automotive Associations
Time Period Captured in the Report:-
Historical Period: 2015-2020
Forecast Period: 2020-2025
Automotive Aftermarket Service
Companies in Vietnam:-
OEM/Authorized Vehicle Service
Companies
Hyundai Vietnam
Toyota Motors Vietnam
Honda Vietnam
Mitsubishi Vietnam
Ford Vietnam
Suzuki Vietnam
Vinfast
Lexus
THACO
Multi Brand Vehicle Service Companies
Vietnam Car Care
Thanh Phong Auto
Vuong Phat Auto
Garage Doanh Workshop
Thanh Tam Auto
Vu Khoi Garage
Pham Vu
Ngyuen Khoi
Liem Gia Phat
Spare Part Suppliers
Denso
Yazaki
Sumitomo
Electric
Toyota
Boshoku
Harada
Hanoi Plastics
Casumina
Kumho Tires
Estec
Pinaco
Tam Hop
Key Topics Covered in
the Report:-
Vietnam Automotive Aftermarket
Service Industry Overview
Value Chain Analysis of Vietnam
Automotive Aftermarket Service Industry
Ecosystem of Major Entities of Vietnam
Automotive Aftermarket Service Industry
Market Size of Vietnam Automotive
Aftermarket Service Industry on the basis of Revenue and Number of Vehicles
Serviced, FY’15-FY’20
Passenger Vehicle Sales in Vietnam,
FY’15-FY’20
Vehicle Parc in Vietnam, FY’15-FY’20
Vietnam Automotive Aftermarket
Service Industry Segmentation, FY’20
Competitive Analysis of Vietnam
Automotive Aftermarket
Competition in Vietnam OEM Automotive
Aftermarket Service Industry
Competition in Vietnam Multi Brand
Automotive Aftermarket Service Industry
Company Profiles of Hyundai, Toyoto
Motors, Vinfast, Mitsubishi Motors, Honda, Vietnam Car Care, Thanh Phong Auto,
Vuong Phat Auto, Garage Doanh Workshop and Thanh Tam Auto
Pricing of Major OEM Automotive
Service Companies
Pricing of Major Multi Brand
Automotive Service Companies
Trends and Developments in Vietnam
Automotive Aftermarket Service Industry
Issues and Challenges in Vietnam
Automotive Aftermarket Service Industry
Porter 5 Forces Analysis of Vietnam’s
Automotive Aftermarket Service Industry
Government Regulations in Vietnam
Automotive Aftermarket Service Industry
Key Decision Making Parameters for
Automobile Servicing: OEM and Multi Brand Vehicle Servicing Companies
Technology Platforms used by OEM and
Multi Brand Vehicle Service Companies
Analysis of Multi Brand and OEM
Workshops in Vietnam
Operating Model of Multi Brand
Workshops in Vietnam
Operating Model of OEM Workshops in
Vietnam
Pain Points in the OEM and Multi
Brand Aftermarket Industry
Opportunities in the OEM and Multi
Brand Aftermarket Industry
Spare Parts Landscape in Vietnam
Market Size of Spare Parts
Aftermarket Industry and Classification by Different Type of Spare Parts
Ecosystem by Different Type of
Spare Parts and Consumables Market in Vietnam
Impact of COVID in the Vietnam
Automotive and Aftermarket Industry
Future Market Size of Vietnam
Automotive Aftermarket Service Industry on the basis of Revenue and Number of
Vehicles Serviced, FY’20-FY’25E
Future Outlook and Segmentations
for Vietnam Automotive Aftermarket Service Industry, FY’20-FY’25E
Analyst Recommendation
For More Information on
the research report, refer to below link:-
Vietnam
Automotive Aftermarket Service Market
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