Source: The Nation
The Department of Public Works and Transport expects the number of vehicle imports to Laos to continue to grow at around 10 per cent even though numbers have slowed somewhat in the first three months of this year.
Officials point out that imports have been slowing as dealers are intending to sell off some of their existing stock.
However, officials believe the rate of vehicle imports will reach the goal for the next two months as vehicle importers start to order new stocks again.
According to the Foreign Trade Policy Department, Laos has begun to reduce import tariffs on goods since 2008 and now import tariffs on many products including vehicles have been reduced to zero. Previously, import tariffs on cars stood at 40 per cent.Import tariffs are a trade barrier that is imposed by countries as part of efforts to protect domestic products. Many countries find it impossible to export goods to countries that impose high tariffs on imported goods.
“This year’s import growth will see the same data as last year,” according to an official, who highlighted that the rate of vehicle imports has grown by 10-12 per cent since 2013.
Officials also pointed out that vehicle imports will continue to increase this year, even though the consumer tax has increased because Lao people’s purchasing power is still high, based on the economic growth rate.
Lao people also have more options to buy vehicles, which are now offered by motor companies featuring promotions such as allowing customers to pay in installments with low interest rates or even zero interest.
These factors have attracted Lao people to make easier decisions to become vehicle owners and are expected to continue to bolster vehicle imports over the coming years.
The Department of Public Works and Transport also reported that the number of vehicles in Laos increased by 8.17 per cent in 2015 compared to the previous year.
The total number grew from 1,577,184 to 1,717,504 vehicles, including 1,326,868 motorcycles, 337,449 cars and 53,187 trucks.
Vientiane has the largest number of vehicles at 721,882, followed by Savannakhet (273,279) and Champassak province (145,289).
The increasing number of vehicles shows that the vehicle market in Laos will further brighten for investment, especially in the era of the Asean Economic Community, officials explained.