Preview

A Detailed Analysis of the Failure If Vietnam's Automobile Industry

Powerful Essays
Open Document
Open Document
4254 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
A Detailed Analysis of the Failure If Vietnam's Automobile Industry
A DETAILED ANALYSIS OF THE FAILURE OF VIETNAM’S AUTOMOBILE INDUSTRY
(Draft version)

Dam Quang Huynh
National Economics University 1. Introduction
The Vietnamese government considered the auto industry an important factor in economy and has announced many incentive policies in order to develop this industry such as taxation and trade policies in many years. Developing auto industry promotes the development of many other supporting industry. Indeed, manufacturing a car requires 2000 to 3000 components, and it is an opportunity for other companies produce automobile parts.
Determining the automobile industry to be a important key in the country’s industrial sector, in the early 1990’s, the Vietnamese Government offered a variety of incentives to attract both domestic and foreign investor’s money in order to develop the young industry. In 2004, the Prime Minister signed Decision No. 177/2004/QD-TTG “Approving the development plan of Vietnam’s automobile industry till 2010, vision to 2020.” This was a turning-point of Vietnam auto industry after a long way of development. However, despite many expectations and privileges offered by the decree, the plan has turned out to be a bitter failure. In fact, the automobile industry in Vietnam is still stalled, it’s development hindered by major roadblocks in Vietnam’s economy and society. Thus, this research aims to analyze the causes of the failure of Vietnam auto industry. 2. Purpose of the proposal
The proposal aims to analyze causes of the failure of Vietnam auto industry by using Evaluating external environment and the five-forces model of competition analytical method. In addition, the proposal will also suggest several solutions for above problem based on the author’s knowledge and experience. 3. Method
Methods are used involving data synthesis and analysis. Data and information used in this proposal are secondary data and collected from some major source such as internet, articles and other research

You May Also Find These Documents Helpful

  • Best Essays

    Automobile Industry Analysis

    • 2795 Words
    • 12 Pages

    Automobile industry has been focused in this analysis being one of the fastest growing industry eventhough it’s highly competitive in the recent years. Since 2005, there are several changes in the Automobile Industry due to globalization and the demand for high featured cars from the growing economical countries despite the oil shortage which is a challenging the industry.…

    • 2795 Words
    • 12 Pages
    Best Essays
  • Good Essays

    Nevertheless, there are other possible contributory factors that affect Vietnam economic performance. On the one hand, Vietnam has…

    • 482 Words
    • 2 Pages
    Good Essays
  • Powerful Essays

    Hailed as ‘the industry of industries’ by Peter Drucker, the founding father of the study of management, in 1946, the automobile industry had evolved continuously with changing times from craft production in 1890s to mass production in 1910s to lean production techniques in the 1970s. The Asian countries, mainly by Japan, China and India, registered a 9% increase in production over last year, constituting 35.9% of the global production. In fact China and India posted positive growth rate over 2003. This supply mainly catered to meet the demand from households where the automobiles constituted the second largest expenditure item next only to housing. Thus the global automobile industry dominated by Europe, US, Japan, and of late by China and India, continued to have a significant influence on economic development, international trade, foreign direct investment and environment-friendly practices.…

    • 3753 Words
    • 16 Pages
    Powerful Essays
  • Better Essays

    The case on the global automobile industry demonstrated by lowering cost through innovative production without sacrificing quality is the defining characteristic in a successful company. I found this case interesting because it characterized a successful automobile producer as one that will cut cost in an innovative approach to deal with a market that is constantly changing. The innovation in producing automobiles started with Ford through mass production and continued all the way to today with companies promoting major suppliers to move closer to assembly plants to cut cost. Since the beginning of the automobile industry the company that was able to lower their cost was the company that would lead the way. However, giving up quality is not a viable option. Lower quality automobiles lead to the down turn in the American automobile market share. In my Porter’s 5 Forces analysis I will identify key competitive forces in the automobile industry.…

    • 1239 Words
    • 5 Pages
    Better Essays
  • Good Essays

    The automotive industry is a tremendous contributor to the comprehensive level of economic growth experienced throughout the twentieth century. With the peak of industrialization finally realized, there existed opportunity for development and modernization of societies around the world. With this in mind, opportunity was present for the production of automobiles for use around the world as well. This substantial demand created the economic opportunity for companies such as General Motors to begin building their empires. As one of the first companies to become a strong contributor in the industry, General Motors quickly placed itself…

    • 298 Words
    • 2 Pages
    Good Essays
  • Best Essays

    There was used a secondary research so that to create this individual report paper. The secondary data that was used in this document was found in the required textbook, in the seminar material, in journals and in the Internet. For the full list of all sources, please see the enclosed references and bibliography.…

    • 3537 Words
    • 15 Pages
    Best Essays
  • Good Essays

    INTERNATIONAL CASE

    • 1141 Words
    • 4 Pages

    Auto industry is important to developing countries is this intensive linkage. Most of developing countries selected auto industry as one of the prime elements for launching industrialization in the country. An independent auto maker and to be global top ten as in Daewoo's long range plan, with 3.5 million production indomestic (3.0 million) as well as in overseas plants (2.5 million) could not achieved without the success of globalization.The leadership in domestic market might be another important factor. Korean auto makers including Daewoo has tomeet the…

    • 1141 Words
    • 4 Pages
    Good Essays
  • Good Essays

    This chapter deals with the methods of research used whether it may be historical, descriptive, and experimental or a case study. The techniques used under Descriptive Research Method as well as the data gathering tools and analytical tools used will be further explained in this chapter as well as the methods used in developing the software and for evaluation.…

    • 3136 Words
    • 11 Pages
    Good Essays
  • Good Essays

    With this few arguments is very difficult to determine if the strategies used by the Chinese are good enough to be implemented in another country. What is true is that the automotive industry in China represents an extraordinary case of industry development. In recent years, China has become the world’s fastest growing automotive producer despite the global economic situation. the domestic Chinese auto industry has made substantial progress. Many independent domestic automotive manufacturers have emerged and have ambitions to make cars for developed countries. Although they have to overcome difficulties, such as creating their own designs and meeting world…

    • 441 Words
    • 2 Pages
    Good Essays
  • Powerful Essays

    The government adopted policies to develop local automotive industry and encourage vehicles to be assembled locally: These include manufacturing vehicle parts locally imposing imports taxes and attracting a tariff system on imports. Another was that, all the dealers and distributors to get import licenses that had to be re-newed in every six months, (Song Y, et al) Though others companies assembled other brands of automobiles, there was an upward surge in the production of many makes and models, leading to lower prices of some parts, hence a challenge to the manufacturers to achieve their economies of…

    • 1334 Words
    • 6 Pages
    Powerful Essays
  • Good Essays

    The data was collected, generated and analyzed by the proponents with the use of the following research instruments and techniques to help them classify precise information for the study.…

    • 693 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    Known as one of the Four Asian Tigers, South Korea, officially known as the Republic of South Korea has become a major force in today’s globalized economy. With a population of just around fifty million people, South Korea has a thriving economy, which is Asia’s fourth largest economy with a GDP (nominal) of $1.151 trillion (ranked 15th) (CIA, 2009). South Korea’s rapidly growing economy is evident when observing how its real GDP has expanded by 8 percent annually, from $2.7 Billion in 1962 to $230 Billion in 1989. Most of South Korea’s early economic development is attributed towards emphasizing most of their labor-intensive work in the industrial sectors. Here, many large conglomerate known as “chaebols” started and made their impression on the world. Factories in Seoul and the Gyeonggi Province contributed to nearly half of the country’s employment, with 2.1 million factory workers back during the economic development times (Green, 1992). Throughout the 1960’s – 1980’s, South Korea’s major contributing sectors to their economy were their shipbuilding, mining, construction, armaments, and their automobile industry. A good sense of a country’s industrial level can be measured from their automotive industry due to that fact the automotive industry is a prime example of generating added value through economies of scale for the country (Lee, 2011). South Korea’s automotive industry is fifth largest in the world in terms of production and sixth largest in terms of exportation in 2010.…

    • 3073 Words
    • 13 Pages
    Powerful Essays
  • Good Essays

    Malaysia is ASEAN's largest passenger car market but also a gateway into ASEAN and a springboard for other countries. Many entrepreneurs of world car have valued it and the automotive market in Malaysia has become a “battleground”. Toyota, Honda, Nissan, Kia, Hyundai, Mercedes-Benz of Germany, BMW, Volvo and other world-renowned automobile manufacturers have already entered the market in Malaysia.…

    • 687 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    However in 2003, Malaysia fell to second place after Thailand in the motor vehicle market of ASEAN. Therefore, a comparative study is undertaken to asses the development of automobile industry of both Malaysia and Thailand. The development of the automobile industry in Malaysia In the 1960s, the Malaysian government encouraged the setting up of automobile assembly plants in Malaysia. The main objectives were to reduce the imports of completely built-up units (CBU) that will help to stabilize balance of payments, to create employment and to provide the base for transfer of technology.…

    • 1713 Words
    • 7 Pages
    Powerful Essays
  • Powerful Essays

    Comparative Advantage

    • 11150 Words
    • 45 Pages

    Vietnam’s current direction is to “open door to the world” and encounrage export and import. Vietnam is one of the strategic markets of Asean exporter. However, due to the effect of financial crisis, export/import figures of Vietnam experience remarkable decrease last year , FDI enterprises also contributed less. In 2009, the export turnovers were at an estimate of USD 56.6 billion, the import turnovers were at an estimate of USD 68.8 billion. There have been a lot of researches related to…

    • 11150 Words
    • 45 Pages
    Powerful Essays