Brian Jeffrey
As of March 1, electric vehicles (EVs) in Vietnam will no longer benefit from zero registration fees.
From this date, EVs will be charged 50% of the registration fees set for traditional combustion engine vehicles with the same seating capacity.
This revision stems from Decree No.10/2022/ND-CP, dated January 15, 2022. Initially, the zero percent registration fee was intended to last for three years, running from March 1, 2022, to February 28, 2025.
After this initial period, from March 1, 2025, to February 28, 2027, EV registration fees will be fixed at half of the costs imposed on petrol and diesel vehicles.
Under this new regulation, the registration fees for battery-powered EVs in Vietnam will translate to approximately 5-6% of the vehicle’s retail price, depending on the purchase location. This marks a notable change from the previous full exemption.
For instance, for an EV costing 1 billion VND (around 40,000 USD), the registration fee would be around 50-60 million VND, influenced by the specific province or city. This new expenditure may affect the overall cost-efficiency and financial planning for electric vehicle owners compared to the previous situation.
Market analysts foresee that the revised registration fees will considerably impact the Vietnamese EV market. The withdrawal of the zero percent exemption could raise the running costs of electric cars, potentially making them less attractive to buyers.
Previously, favorable policies have spurred sales and inspired a shift towards ‘green cars’ in Vietnam. However, this transition is considered a crucial move for sustainable development within the electric vehicle industry, reducing dependency on temporary incentives.
Experts expect an increase in EV purchases before the zero percent registration fee ends in February 2025, as consumers strive to benefit from the remaining waiver, potentially saving tens of millions of Vietnamese dong.
The implementation of registration fees opens up new challenges and opportunities for manufacturers, particularly for VinFast, which has heavily invested in boosting EV adoption.
VinFast is also promoting a complimentary battery charging initiative at its V-Green public charging stations, running until June 30, 2027, for all users of their electric vehicles, including those in the transport sector.
This initiative not only enhances the attractiveness of VinFast’s electric vehicles but also supports the widespread adoption of electric transportation throughout Vietnam.
Vietnam’s EV market is still in its infancy compared to other countries in the region, with around 500,000 vehicles currently in circulation. It is essential to implement effective strategies to encourage market growth.
Industry experts warn that without significant supportive policies, the demand for EVs in Vietnam may stall or decrease by 2025.
Many businesses believe that current incentives for electric vehicles are inadequate compared to those in other regional markets.
To invigorate the EV sector, they recommend effective policies such as tax incentives, low-interest financing, infrastructure development, purchase subsidies, and raising public awareness.
A report from the World Bank predicts considerable growth in electric vehicle sales in Vietnam, estimating 163,000 units by 2025, 559,000 by 2030, nearly 1.3 million by 2035, and around 6.8 million by 2050.
For Vietnam to achieve these ambitious goals, it’s vital to adopt suitable policies.
Mordor Intelligence’s analysis estimates the overall electric vehicle market in 2024 to be worth 2.48 billion USD, anticipating growth to 5.67 billion USD by 2029, with a compound annual growth rate (CAGR) of about 18% between 2024 and 2029.
