THACO when automobie import tax is 0%

(VLR) (Vietnam Logistics Review) Automobile import tax will be 0% in 2018. However, Truong Hai Automobile J.S Company (Thaco) keeps expanding its production, increasing the rate of localization, implementing the strategy of automobile locally build-up in accordance to the policy from the Government: Thaco Mazda will be the largest Mazda’s factory in the Southeast Asia. The factory has been being built by Thaco and will be put into operation at the end of March 2018.

(Vietnam Logistics Review) Automobile import tax will be 0% in 2018. However, Truong Hai Automobile J.S Company (Thaco) keeps expanding its production, increasing the rate of localization, implementing the strategy of automobile locally build-up in accordance to the policy from the Government: Thaco Mazda will be the largest Mazda’s factory in the Southeast Asia. The factory has been being built by Thaco and will be put into operation at the end of March 2018.

A factory with the capacity of 100,000 automobile pa will soon come into operation

Tran Ba Duong-Thaco Board of Administration’s President- revealed Thaco signed a cooperation agreement with Mazda, Japan in 2011 and has been being built the Vina Mazda factory with the initial capacity of 10,000 cars pa. In 2014, the capacity was upgraded into 30,000 cars pa. Vina Mazda has built up all Mazda’s cars as Mazda 2, Mazda 3, Mazda 6, and Mazda CX-5 and they are popular in the market. So far, Thaco has sold 92,000 cars, over 32,000 cars in 2016- making Mazda the second largest Japanese automobile brand in term of sales in the Vietnam market.

Thaco Mazda factory with the capacity of 100,000 cars pa started to build at the end of March 2017, with the total capital of VND 12,000bn on the area of 35ha. The assembly line is provided from European and Japanese famous equipment manufacturers. Most of them are automated ones and applied with Industry 4.0 IT management as completely automated chassis welding line, electro static power continuous-dipping coating line combined with reverse flows to minimize painting defects, robotcontrolled painting assembly with weton-wet technology, increasing painting durability in the progress of using. Quality control assembly equipped with new technology connecting to a global Mazda quality control center in Japan.

Another thing is the test drive road of 5km with various test drive lanes with terrains similar to those in Vietnam. “With design and building experience from Thaco Mazda, we will upgrade all other factories so that Chu Lai- Truong Hai Mechanical Automobile Industrial Zone will become a sample of automobile and assisting industries,” Duong shared his thoughts.

Role of automobile “big boss”

Thanks to tax on CBU will be 0% in 2018, Vietnam’s automobile assembly enterprises are likely to import CBU ones from product centers in ASEAN region. However, to implement the guideline from the PM on Strategy to Develop Vietnam Automobile Industry to 2025, vision to 2035, Thaco has kept its CDK assembly line and invest in production to increase the localization rate. This is Thaco commitment to the Government and Vietnam automobile’s industry to produce automobile in large scale and gradually compete with other regional countries as Thailand, Indonesia and Malaysia…

From a small private enterprise, Thaco attempted to invest in automobile assembly and has become a leading automobile enterprise in Vietnam. Step by step, Thaco has had full control of design and technology and has had the rate of localization of over 50% to buses, 30%- 35% to trucks, and 18% for sedan. Thaco hold 40% of the truck market share, 50% of the passenger vehicles market share; 2 brands of KIA and Mazda hold over 26% of the market share and has led the Vietnam’s sedan market in 2016. In the coming time, Thaco keeps developing assisting industry to increase its localization rate to sedan to the target of 40%. Then, Thaco is able to export them to ASEAN countries.

From 2017, Thaco has carried out a strategy to build factory of automobile production and assembly as KIA sedan factory, Mazda, outclass sedan, bus and truck factories and other spare part production factory to increase localization rate to over 40%. Among which, Thaco Mazda is the Mazda’s largest factory and also the largest automobile production and assembly in the Southeast Asia. Thaco Mazda has cutting edge technology and is fully automated, able to meet requirement of Mazda’s lines 7th generation. This is a sample project for Thaco’s investment circle in Chu Lai. “Our challenges are how to meet the needs for cheaper cars but with better design and quality from people and how to develop the automobile industry in Vietnam, contributing to industry and country development in the situation of ASEAN integration in 2018,” said Duong. Thaco is currently reducing price in accordance to the integration road map when import tax become 0% and special consuming tax on automobile of under 2.0 reduces to 5% on January 1st, 2018.

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