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21 Aug 2023
Over three years, sales of compact high ground clearance vehicles have increased by three times while that of B-sized sedans have almost not grown and A-sized hatchbacks have suffered a decline of 42%.
Cumulative sales by July of the group of small high ground clearance cars (A+ to C-) have reached 37,238 units. This is the best-selling car segment in the Vietnamese auto market, surpassing the traditional B-segment sedan group (25,896 cars) that dominated the market many years ago.
Preference for high ground clearance cars has become a worldwide trend in the past 5-7 years, including in Vietnam. The clear imprint of this trend began about 3 years ago, when companies diversified the CUV/SUV product range, therefore their sales increased significantly.
High ground clearance’s growing popularity
In the past 3 years, The four segments with the highest sales in the market were B-segment sedans, A-segment hatchbacks, small CUVs and MPVs. These are the segments in the price range of about 800 million or less. In 2022, these four sold more than 226,000 units, accounting for about 44.5% market share of the entire Vietnamese market (508,545 vehicles), which includes commercial vehicles.
Small-sized CUVs in Vietnam are currently divided into 3 main groups, including the traditional B size, where models such as Hyundai Creta , Kia Seltos , Honda HR-V … stand out in terms of sales. Slightly lower class are A+ models like Kia Sonet , Toyota Raize or VinFast VF 5 Plus. Below size C are models of middle B+ size with the representative Toyota Corolla Cross , beside the Mazda CX-30 .
“The trend of favoring models with high chassis, modern design, and many options created by customers is gradually rejuvenating,” said the product training team leader of a Hyundai dealer in Ho Chi Minh City. “Many amenities, multi-use with the same price as B-size sedans, A+ and B-sized CUVs are popular.”
When customers prefer high ground clearance vehicles, manufacturers also maximize the supply to the market by “SUVization” of products from micro, small to medium. This was shown by the way companies launch their new products.
Toyota brings the Corolla Cross (size B +) to Vietnam in 2020. By 2021, the company will have an additional Raize (A+) and in September, Yaris Cross will be a pure B-sized CUV model introduced. The Japanese company focuses entirely on the small CUV segment, leaving C-sized CUV. However, it is likely that the new generation MPV Innova with SUV style will be positioned by the company in the C-sized CUV group instead of the RAV4, which has not yet been planned for Vietnam and Southeast Asia markets.
After launching Kia Seltos in 2020, Truong Hai introduced Kia Sonet to compete with Raize in 2021. In the same year as Sonet, Mazda launched the CX-3 and CX- 30 duo of sizes B and B+ to the market, respectively. In March 2022, Hyundai Thanh Cong replaced the discontinued Kona with the Creta model imported from Indonesia.
In the past 2 years, other CUV names have appeared in Vietnam such as Nissan Kicks , Volkswagen T-Cross (size B), VinFast VF e34 (size B+), VinFast VF 5 Plus (size A+)… For the upcoming, VF 3 (size A-), Mitsubishi Xforce, VinFast VF 6, Omoda 5 (size B), Jaecoo 7 (size B+) will be launched in the market. Brand Czech Republic, Skoda starting business next September will also introduce a duo of SUV products (size C and D).
VinFast, exclusively, after the death of gasoline cars, including sedan Lux A and A-size hatchback Fadil, their current product range is all-electric CUV/SUV, expanding from A to E. There are no sedans at all in the company’s plan up to now.
In the MPV group, the great success of Mitsubishi Xpander in Vietnam attracts many competitors to look for opportunities. In the second half of 2022, Hyundai brought back the Stargazer, Truong Hai launched the Kia Carens. And most recently, Honda introduced the BR-V for the first time to the Vietnamese market. In the near future, MPV models of MG, Haima will also appear.
Even with MPV, companies also created a wave of SUVs to customize their products to please customers. For example, Mitsubishi has a Cross version for Xpander, Suzuki makes XL7 with small SUV-like tweaks based on Ertiga .
Toyota put the Cross suffix on the Veloz to separate the design from the Avanza model (both sharing the same chassis). Honda BR-V , Kia Caren are shaped in the SUV trend. Hyundai Stargazer recently also has an X variant with a stronger design, more SUV, aimed at competing with Xpander Cross.
According to experts, the trend of high-altitude multi-purpose vehicles (CUVs) will continue to grow in the coming time. The blooming of CUV’s interwoven product lines will cause segments such as B-segment sedans or A-segment hatchbacks to share fewer customers.
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