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July 30, 2008

Vietnam: Luxury car importers see rising profits

Vietnam’s automobile importers expect luxury cars will continue to dominate vehicle imports in the second half of this year as the demand is still on the rise, reported state news agency VNA.

In mid-July, the Euro Auto Company, an authorised local distributor of BMW in Vietnam, opened a showroom in the capital city of Hanoi where it introduced a four-seat sport X6 which retails for 130,000 euros ($202,449) after the model hit the global market just two months ago.

At the same time, Euro Auto inaugurated a showroom displaying fashioned auxiliary equipment and souvenirs featured BMW products in Ho Chi Minh City while hurrying up its preparations for the opening of a BMW centre at Ho Chi Minh City's outlying Phu My Hung Urban Complex late this year.

Euro Auto Director General Huynh Du An told the Vietnam News Agency that those moves were an indication of the BMW group's confidence in thriving prospect of Vietnam s economy under the Government's management. He said that Euro Auto has sold 100 BMWs of various types so far this year.

Euro Auto is among local car importers who have high hopes on lucrative sales of luxury cars in the country after seeing more and more brand names like Rolls Royce, Bentley and Audi with pre-tax price of not below US$100,000 running in big cities like Hanoi, Ho Chi Minh City and Hai Phong.

The Ho Chi Minh City-based Ben Thanh Corporation, which has been involving in multi-trades for years, is planning to open the first luxury car supermarket in Vietnam .

The Saigon Car Mart is expected to open late September, a senior official of the Ben Thanh Corporation said, adding the mart will offer customers various choices, with such luxury names as Bentley, Rolls Royce, Mercedes Benz, BMW, Ferrari and Lexus.

Meanwhile, imports of other kinds of completely built up units or CBUs declined in recent two months, from 5,500 units in May to 4,500 in June.

It was partly attributed to the Finance Ministry's decision to raise the import tariff on CBUs from 60 percent to 83 percent and banks tougher loan restriction to reduce inflation.

Experts forecast a continual decline in imports of CBUs in the second half of the year following the Government's solutions to rein in raging inflation.

According to the Ministry of Transport and Communication, there are over 800,000 automobiles in Vietnam, compared to over 20 million motorbikes.

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