Vietnam Special Report - Vietnam Industrial Real Estate Market - DEC 2018 - EN
The consumer demand for automobiles in Vietnam is driven by favorable macro-economic conditions such as high and stable GDP growth rate as well as growing average income level, rapid improvements in infrastructure, increasing middle and affluent class. Even though the Vietnam automobile market is a very promising one, the domestic manufacturing industry is still not able to satisfy the very fast-growing demand due to long-term major issues such as low localization rate, high production cost and lack of production experience.
Domestic protection of the government in terms of policy and market regulation plays an important role in developing the Vietnam automobile industry. Recent changes in government policies are significantly affecting the automobile manufacturing and assembling industry. These changes also create opportunities for industrial land development. Industrial real estate developers are now in a very good time to exploit benefit from the manufacturing expansion demand of automobile manufacturers and assemblers. Besides, they can also offer solutions in terms of automobile specialized industrial zones for the government to boost this industry. In Vietnam, even though the automobile industry is far behind in developing production and assembling compared to other ASEAN countries, industrial land accumulation for the automobile industry has been increasing in the market. Each region of Vietnam has its own competitive advantages which are based on the differences in the trading nature and available land bank.