Cambodia-made car causes shocks to Vietnam’s auto industry

VietNamNet Bridge – Vietnamese policy makers and automobile manufacturers these days incur the heavy criticism from the public which is disbelief about the news that Cambodia has successfully made electric cars.



auto market, cambodian cars, car imports




Heng, a Cambodian development company, has made a big surprise when introducing its self-modified electric car.

The car, named Angkor EV 2014, is created by a local designer, manufactured by Heng Company which has set up a $20 million factory in Kandal province.

The car, operated by smart phone and RFID (radio frequency identification), installed with GPS system, can roll on at the speed of 60 kilometers per hour at maximum. Heng Development Company has affirmed that the car would be priced at no more than $10,000 when it is marketed.

The great achievement of Cambodia, the country with a fledgling manufacturing industry which has been relying on foreign imports, has surprised many other countries, including Vietnam.

Vietnamese auto forums’ members have commented that Vietnam should feel ashamed when seeing Cambodia making its electric cars.

While foreign invested and domestic automobile manufacturers are still busy complaining about the difficulties in the business environment, Cambodians have spent their time on a better job – making an electric car.

Vietnam has spent a lot of money and time, and made big efforts to develop its automobile industry over the last tens of years. However, it still cannot gain any considerable achievements in the field.

Vietnamese enterprises even cannot make the simple parts and accessories like electric wire, plastic parts or screws. A lot of the world’s big automobile groups have threatened to leave Vietnam because of the country’s weak supporting industries.

Toyota, Madaz and Ford have reportedly canceled the automobile projects worth $700 million-1 billion in Vietnam because they cannot find suitable car parts for the assembling.

Nissan has reportedly announced that its automobile factory in Indonesia would have the investment capital higher by $100 million than initially planned, which would churn out 250,000 products per annum by 2014 instead of 100,000.

Prior to that, Honda said it is considering setting up a new factory in Jakarta, Indonesia, to be capitalized at $337 million and the capacity of 180,000 products per annum. Meanwhile, Ford tends to focus on Thailand and the Philippines, though 10 years ago it believed that Vietnam was an attractive investment place.

How to develop supporting industries has been the hot topic for discussion at policy makers’ conferences and workshops. However, no considerable progress has been made so far.

There are about 210 enterprises in the supporting industries in Vietnam. Most of the enterprises providing car parts and accessories are Japanese, Taiwanese or South Korean invested ones. After 20 years of developing the automobile industry, the locally made content proportion is still modest at 5-10 percent.

Nguyen Manh Quan, Director of the Heavy Industry Department of the Ministry of Industry and Trade, blamed the weak supporting industries on the small scale of the domestic car market, where only 100,000-200,000 products are consumed every year.

However, Duong Dinh Giam, Head of the Industry and Trade Policy Research Institute, pointed out that the small market is not the only reason behind this. He said it is necessary to reconsider the current policies that aim to encourage the connection between foreign invested and domestic enterprises.

Mai Chi
auto market, cambodian cars, car imports
 
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