Han Media: Korean Cars Are Losing Ground in the Vietnamese Market!

On August 31, the South Korean media outlet "Hanjie Economy" published an article stating that in the Vietnamese market, Hyundai and Kia were once synonymous with "the first car" for Vietnamese consumers due to their excellent performance and reasonable prices, but their position is now being shaken.

For many years, Korean cars have rapidly occupied the Vietnamese market with light vehicles and SUVs, but they are now facing challenges from Japanese cars, Chinese cars, and the Vietnamese company Vinfast, and their position is increasingly threatened.

For the Hyundai Motor Group, Vietnam is not only an export market, but also its most important base in Southeast Asia. In fact, Hyundai and Kia sold a total of 165,115 vehicles in Southeast Asia last year, of which 101,738 were sold in the Vietnamese market. This number accounts for about 63% of the total sales, which is significant.

In the first half of this year, the Vietnamese automobile market grew rapidly, with an overall increase of 42%, but the sales of Hyundai and Kia compared to the same period last year both declined. Hyundai's sales in the first half of the year were 24,204 units, a 1% decrease from the previous year, maintaining the third position in overall sales, but in the context of a significant market growth, Hyundai's sales have decreased. On the other hand, Toyota's sales increased by 31% year-on-year.

Kia's decline was even more severe, with sales of 14,007 units in the first half of last year, but a sharp drop of 12% this year to 12,293 units, dropping to fifth place in rankings.

Hyundai's sales in Vietnam have been declining for several years. In 2024, Hyundai sold 67,168 vehicles in Vietnam, a decrease of about 18% from 81,582 units in 2022. At the same time, Kia's sales dropped by 24% from 45,532 units to 34,570 units. During this period, the Vietnamese automobile market grew by 20%, but Korean cars lagged behind.

Over the past 10 years, Hyundai and Kia have focused on the "first car" market in Vietnam, emphasizing cost-effectiveness centered around compact sedans and compact SUVs. For this reason, Hyundai and Kia established production bases in Ninh Binh province in the north and Quang Ninh province in the central region respectively.

In fact, their sales strategy has always been centered around compact sedans and SUVs, rather than luxury cars, but some point out that this does not reflect the changing consumer trends in recent years.

In the early stages, Korean cars had sufficient appeal to consumers due to their local production bases, fast design update cycles, reasonable prices, and rich options, but the situation has changed now.

Analysts believe that as the Vietnamese automobile market gradually matures, it is no longer enough to meet consumers' expectations as before with just price competitiveness or design. Consumers are beginning to value future technology elements such as electric vehicles and advanced driver assistance systems (ADAS). Younger generations are also considering brand emotions, connectivity, and user experience, making competitors who accurately grasp these factors more advantageous.

In contrast to the poor performance of Hyundai and Kia, Japanese companies have accurately interpreted local demand trends and taken swift measures. Toyota and Mitsubishi are focusing on price competitiveness and a wide range of choices, which are considered advantages of Korean cars.

Chinese automakers, including BYD, are entering the emerging electric vehicle market. VinFast, a Vietnamese company, sold over 67,000 units in the first half of this year, more than three times the amount from the same period last year. Three models from VinFast, including VF 3, VF 5, and VF 6, all made it onto the list of the top ten best-selling vehicles in Vietnam during the first half of the year.

A South Korean automotive industry insider said: "With more choices available to Vietnamese consumers, the appeal of Hyundai and Kia cars is no longer as strong as before. Japanese manufacturers are beginning to focus on cost-effectiveness, while VinFast is tapping into the public's patriotic sentiment. We need to vigorously promote our products, including product lines specifically tailored for the Vietnamese market."

Original: www.toutiao.com/article/1841956252169224/

Statement: The article represents the views of the author.