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K-Line 2020 (HD)
K-Line 2020 (HD)
K-Line 2020 (HD)
Vietnam is the fourth-largest motorcycle market in the world after India, Indonesia, and China. Two- VEHICLE POPULATION IN VIETNAM BY TYPE, 2 0 1 5 TO 2 0 1 9
wheelers have accounted for over 91% of the total vehicle parc. In the last five years, the growth of the two-
wheeler parc has slowed because of weak domestic sales, as increasing number of high-income households THOUSAND UNITS % OF TOTAL
prefer passenger cars. In 2019, two-wheeler sales declined by (3.9%), while in 2018 the sales growth was VEHICLE TYPE 2015 2016 2017 2018 2019 2019
3.5%. Mo t o rc yc le s, m o p e d s, sc o o t e rs 4 0 ,0 0 0 4 0 ,7 0 0 4 1 ,7 0 0 4 2 ,3 0 0 4 3 ,1 0 0 91
Passenger-vehicles sales witnessed massive year-on-year sales growth of 31% in 2018 and 20% in 2019. Pa sse ng e r ve hic le s 1 ,6 9 5 1 ,8 5 4 2 ,0 0 1 2 ,1 7 3 2 ,4 0 3 5
Increasing sales of passenger vehicles can be attributed to increases in personal income and growing health-
Truc ks, p ic kup s, va ns 920 979 1 ,0 3 5 1 ,0 8 0 1 ,1 2 5 2
related concerns about severe pollution major cities like Hanoi and HCMC. Sales will increase despite an
increase in prices after the elimination of import taxes on vehicles from ASEAN countries. Bus, m inib us 394 419 444 463 482 1
Commercial-vehicle sales in Vietnam have not followed the sales successes of passenger vehicles, and their Eng ine e ring ve hic le s-a 85 100 112 117 125 0
sales dipped by 15% in 2018 over 2017. Sales of trucks fell by 6% and buses by 19% in 2019. Sales have To t al 4 3 ,0 9 4 4 4 ,0 5 2 4 5 ,2 9 2 4 6 ,1 3 3 4 7 ,2 3 5 100
fallen despite growth in manufacturing and processing industries, as well as infrastructure improvement.
a - Inc lud e s ve hic le s suc h a s d um p t ruc ks, t ra c t o rs, w a st e ha ule rs, c ra ne t ruc ks, a nd va c uum t a nk t ruc ks, a m o ng o t he r
In April 2019, Decree N20 took effect and registration fees for pickup trucks and vans tripled. This created sim ila r ve hic le s.
significant changes in the automotive market.
SOURCE: Vie t na m Aut o m o t ive Ma nufa c t ure r Asso c ia t io n, Vie t na m Asso c ia t io n o f Mo t o rc yc le Ma nufa c t ure rs, a nd Kline
Vietnam’s passenger-vehicles market is relatively small and fast growing in Southeast Asia. Vietnam has e st im a t e s
local assembly plants for Hyundai, Mazda, Mitsubishi, SsangYong, Suzuki, Toyota, and Mercedes-Benz.
Many of the passenger vehicle sold in the country are also imported.
The localization rate of the automobile industry is far lower than that of other Southeast Asian countries,
such as Thailand, Malaysia, and Indonesia. The Vietnamese government is committed to reducing the
dependency on imports of vehicles and auto components and to increasing domestic production of vehicles. VEHICLE PROD UCTION IN VIETNAM BY TYPE, 2 0 1 7 TO 2 0 1 9
Decree 116 took effect in January 2018. It compels OEMs to manufacture auto components locally. Under UNITS % OF TOTAL
Decree 116, local vehicle importers need to obtain Vehicle Type Approval certificates from the country of VEHICLE TYPE 2017 2018 2019 2019
origin to verify quality, safety, and environmental protection. Many exporting countries do not provide such Mo t o rc yc le s , m o p e d s , s c o o t e rs 3 ,1 3 0 3 ,2 7 8 3 ,4 3 1 93
certification, thus obliging OEMs to expand domestic production. In February 2020, the Vietnamese
government loosened regulations on imports of completely-built-unit (CBU) vehicles and automotive Pa s s e ng e r ve hic le s 134 209 211 6
components. Decree 116 was enacted in 1918 to keep the domestic manufacturing industry from losing Lig ht t ruc ks a nd c o m m e rc ia l ve hic le s 49 45 35 1
sales to other AFTA countries. To t a l 3 ,3 1 3 3 ,5 3 2 3 ,6 7 7 100
Motorcycle OEMs in Vietnam include Honda, Yamaha, Suzuki, and Sanyang Motor Co. Ltd., as well as SOURCE: LMC Aut o m o t ive , Fe d e ra t io n o f As ia n Mo t o rc yc le Ind us t rie s , Kline & Co m p a ny a na lys is .
Chinese OEMs, such as Sanshui Jialing Motorcycle Co. Ltd. Piaggio from Italy, a trusted name for
scooters, has also grown quickly in Vietnam in recent years.
Vehicle Population, Production, and Sales (continued)
Passenger-vehicle sales, including SUVs, have shown the highest sales growth in the last two years. Sales of passenger vehicles grew by 31% in 2018 and 20% in 2019. In 2019, OEMs and dealers reduced passenger-vehicle prices to clear
inventory and boost sales of new models. Prices are further expected to drop to accommodate market trends. Reductions in prices boosted the sales of passenger vehicles in the second half of 2019 and the trend is expected to continue in the
coming years, especially with the introduction of new models. The prices of luxury passenger vehicles from OEMs such as BMW, Audi, and Mercedes-Benz have also been reduced as a result of increasing competition in the automotive
market.
Sales of commercial vehicles, including light-, medium-, and heavy-duty trucks and buses have declined despite the increasing manufacturing output and trade. Sales of commercial vehicles are expected to recover with the growth of the
industrial sector.
Sales of two-wheelers declined by (3.9%) in 2019 after many years of sales growth. This decline can be attributed to growing inclination toward EVs and passenger vehicles.
According to the General Department of Customs, in the first 11 months of 2019 over 135,200 CBU vehicles were imported, with a value of USD 2.91 billion, nearly double both the volume and value over the same period of the previous
year.
The total demand for finished lubricants in Vietnam was estimated at 353.0 kilotonnes in 2019.
Commercial automotive lubricants accounted for the largest share at 37% or 130.1 kilotonnes in 2019. ES TIMATED D EMAND FOR FINIS HED LUBRICANTS IN VIETNAM
Consumer-automotive-lubricant demand followed at 112.6 kilotonnes, which translates to 32% of the total BY MARKET S EGMENT, 2 0 1 9
demand for finished lubricants. MARKET S EGMENT KILOTONNES % OF TOTAL
Consumer automotive lubricants demand growth was led by the motorcycle oil (MCO) segment, which Co m m e rc ia l a ut o m o t ive lub ric a nt s 1 3 0 .1 37
registered growth of 3.2% in 2019 over 2018. MCO was the largest part of the consumer segment in Co ns um e r a ut o m o t ive lub ric a nt s 1 1 2 .6 32
Vietnam with an 81% share in 2019.
Ind us t ria l o ils a nd fluid s 1 1 0 .3 31
Industrial lubricants accounted for a 31% share of overall lubricants demand in Vietnam in 2019. The TOTAL 3 5 3 .0 100
demand in the industrial segment witnessed a year-on-year increase of 1.5% in 2019. This growth was
driven by Vietnam’s rapid growth in industrialization. In 2014 the Ministry of Industry and Trade
announced its industrial development strategy through 2025. Telecommunications, textiles, food, furniture,
plastics, and paper are the major industries in Vietnam. The manufacturing sector in the country grew by
10.9% year-on-year in 2019.
CPC Corp., a state-owned enterprise from Taiwan, announced in 2018 its investment of USD 60.5 million
(TWD 1.79 billion) to build a lubricant-blending plant in Vietnam’s Dong Nai Province. The plant will
have an annual capacity of 32,000 kiloliters of lubricants and solvents. It will be operated by MAXIHUB
Co. Ltd., a joint venture of CPC Corp., Unishine Chemical Corp., and Excel Chemical Corp. The plant is
expected to be operational by the end of 2020.
In 2020, the government of Vietnam has cut import taxes to 5% after increasing them in 2019. Finished
lubricants are being imported from Russia, the UAE, South Korea, India, and Malaysia.
Commercial Automotive Lubricants
OVERVIEW
Commercial automotive lubricants include HDMO, hydraulic and transmission fluids (HTF), gear oil, and grease. Commercial-lubricant demand in Vietnam was estimated at 130.1 kilotonnes in 2019. HDMO was the largest segment of
commercial automotive lubricants in Vietnam, with a share of 86% in 2019. Sales of commercial vehicles declined in 2018 and 2019 despite infrastructure developments, and greater construction and transport activities.
APPLICATIONS
Commercial automotive lubricants are consumed throughout Vietnam in buses and trucks and in off-highway vehicles and equipment employed primarily in the agriculture, fishing, construction, and mining industries.
According to the General Statistics Office of Vietnam, on-road vehicles are the most widely used mode of commutation. As of 2019, 1,967 kilometers of road network were either completed or under construction in Vietnam.
On January 13, 2004, according to Decree No. 23/20004/ND-CP, the Vietnamese government mandated vehicle-age limits:
⸺ Trucks shall not exceed 25 years.
⸺ Passenger vehicles shall not exceed 20 years.
⸺ Converted passenger vehicles (from other types of vehicle before January 1, 2002) shall not exceed 7 years.
Over the last few years, the government’s move to limit the age of vehicles in use has resulted in significant upgrades in the commercial automotive segment and parc. However, despite the ban by the government, substantial numbers of
low-end and obsolete diesel-engines vehicles are still in use in rural areas.
With the increasing manufacturing output and activity in the construction sector, the demand for off-highway vehicles and equipment such as dump trucks, truck trailers, and excavators is also increasing. These vehicles are generally
imported from other countries and come with OEM recommendations for lubricating oils. Therefore they require higher-quality lubricants.
In 2015, the Ministry of Transport released Circular NO 46/2015 to monitor road capacities and to prevent the overloading of heavy- and medium-duty commercial vehicles running on public roads. The circular is reviewed and updated
periodically by the Ministry of Transport. However, because of corruption and lack of proper administration, the implementation of the policy remains weak.
The Ministry of Transport has installed truck scales (weighbridge stations) combined with toll booths to curb the issue of overloading. This measure has increased the cost of commercial transport. The Ministry of Transport has also been
organizing large-scale awareness programs combined with stringent enforcement measures that include strict penalties. The government intends to continue these measures along with periodic inspections to eliminate overloading by the
year 2020.
Commercial Automotive Lubricants (continued)
HDMO represented the largest segment of commercial automotive lubricants in Vietnam in 2019 with a
ES TIMATED D EMAND FOR COMMERCIAL AUTOMOTIVE LUBRICANTS IN VIETNAM BY PROD UCT TYPE
share of 86%. In overall HDMO consumption, multigrades accounted for 73%, while monogrades AND S AE VIS COS ITY GRAD E, 2 0 1 9 TO 2 0 2 9
accounted for 27%.
KILOTONNES CAGR, %
⸺ Monogrades still accounted for a large share of HDMO because of a large parc of old vehicles. PROD UCT / S AE VIS COS ITY GRAD E 2019 2024 2029 2019 - 2024 2024 - 2029
However, with the increasing number of new vehicles the demand for monogrades is expected to HD MO
decline rapidly. MULTIGRAD E
1 5 W-4 0 4 0 .8 4 9 .3 6 5 .7 3 .9 5 .9
⸺ The consumption of multigrades is expected to increase as OEMs recommend better-quality
2 0 W-5 0 3 0 .2 3 2 .1 3 8 .4 1 .2 3 .6
lubricants. Stringent emission regulations and OEM recommendations have driven demand for 15W-
1 0 W-4 0 1 0 .9 1 3 .8 1 8 .7 4 .8 6 .3
40 and 10W-40 viscosity grades.
To t a l 8 1 .9 9 5 .2 1 2 2 .8 3 .1 5 .2
⸺ In multigrades, 15W-40 accounted for the largest demand, with a share of around 50%, and demand MONOGRAD E
is expected to continue growing. This growth is coming from the shift away from 20W-40, which is SAE 4 0 1 8 .6 1 0 .9 7 .3 (1 0 .1 ) (7 .7 )
preferred by owners and operators of older vehicles. SAE 5 0 1 1 .6 7 .0 4 .9 (9 .6 ) (6 .9 )
⸺ 10W-40 is expected to witness the highest growth over the forecast period, as this grade is To t a l 3 0 .2 1 7 .9 1 2 .2 (9 .9 ) (7 .4 )
recommended by all major OEMs. To t a l 1 1 2 .1 1 1 3 .1 1 3 5 .0 0 .2 3 .6
HTF
⸺ OEM-authorized workshops also play a major role in the selection of lubricating oils, as these HTF 4 .8 3 .9 5 .0 (4 .1 ) 5 .1
workshops recommend and use high-quality products to meet engine specifications. Tra c t o r hyd ra ulic fluid 3 .4 2 .8 3 .6 (3 .8 ) 5 .2
⸺ Improving e-commerce, ride hailing, and app-based grocery delivery are also expected to drive Aut o m a t ic t ra ns m is s io n fluid 0 .5 0 .4 0 .5 (4 .4 ) 4 .6
HDMO demand as the number of commercial vehicles operated by these businesses increases To t a l 8 .7 7 .1 9 .1 (4 .0 ) 5 .1
throughout the forecast period. GEAR OIL
8 5 W-1 4 0 2 .1 2 .8 3 .4 5 .9 4 .0
Gear oil accounted for a 4% share of overall consumption of commercial automotive lubricants. The 8 0 W-9 0 0 .9 1 .3 1 .6 7 .6 4 .2
demand for synthetic gear oil is low in Vietnam because it sells for higher prices than conventional gear oil. All o t he r 2 .6 2 .7 2 .7 0 .8 0 .0
85W-140 and 80W-90 are the preferred multigrade gear oils. Multigrade gear oils provide better load-
Synt he t ic 0 .1 0 .1 0 .3 0 .0 2 4 .6
bearing capacity and rust prevention compared to monogrades.
To t a l 5 .7 6 .9 8 .0 3 .9 3 .0
GREAS E 3 .6 4 .6 5 .5 5 .0 3 .6
TOTAL 1 3 0 .1 1 3 1 .7 1 5 7 .6 0 .2 3 .7
Commercial Automotive Lubricants (continued)
PERFORMANCE SPECIFICATIONS
In Vietnam, the American Petroleum Institute (API) categories are used to classify HDMOs. API service ES TIMATED D EMAND FOR HD MO IN VIETNAM BY API
categories CG-4/CF-4 with CF-2 and below accounted for about 50% of the total HDMO consumption in S ERVICE CATEGORY, 2 0 1 9
2019. API S ERVICE CATEGORY KILOTONNES % OF TOTAL
CH-4 was the largest current service category, with a share of 21%. CF-2 is still the largest category, with a CF-2 (o b s o le t e ) 2 6 .9 24
share of 24%, mainly because of Vietnam’s large old-vehicle parc. CH-4 are used in four-stroke engines CH-4 2 3 .5 21
designed to meet 1998 exhaust emission standards. CH-4 exceeds the performance of CD, CE, CF-4, and CI-4 1 5 .1 13
CG-4 oils.
CI-4 PLUS 1 5 .1 13
The CJ-4 category is used in mostly newer equipment, and therefore finds limited use in the country. API CF-4 (o b s o le t e ) 1 4 .6 13
CJ-4 oils exceed the performance criteria of API CI-4, CI-4 PLUS, CH-4, CG-4 and CF-4. Implementation
CG-4 (o b s o le t e ) 1 4 .6 13
of the Euro V emission standard is expected to boost the use of CH-4 and above service categories. Euro V
mandates stricter emission standards and requires the use of cleaner fuel and superior quality lubricants. CJ-4 2 .3 2
About 50% of the commercial-vehicle market in the country makes use of obsolete service categories To t al 1 1 2 .1 100
because of the prevalence of old vehicles. However, use of obsolete service categories is declining as newer
vehicles enter the overall parc.
The latest service category introduced in Vietnam is CK-4. However, categories such as CK-4 and CJ-4
have limited market share as they are used only by specific end users.
Euro V implementation is expected to increase the number of vehicles using modern engine technology,
and these vehicles require lubricants meeting the newer API service category specifications.
Commercial Automotive Lubricants (continued)
SYNTHETICS AND SEMI-SYNTHETICS ES TIMATED D EMAND FOR HD MO IN VIETNAM BY ⸺ After switching to an IWS after the warranty period, vehicle
FORMULATION TYPE, 2 0 1 9 owners/operators generally seek the workshop’s advice for
The penetration of synthetic and semi-synthetic HDMO was still the choice of lubricants.
very low compared to conventional HDMO. The demand for FORMULATION TYPE KILOTONNES % OF TOTAL
conventional HDMO stood around 94% in 2019, while semi- Co nve nt io na l 1 0 5 .4 94 ⸺ Some of company-affiliated workshops lead the demand
synthetic and synthetic HDMO represented shares of 2% and 4% Synt he t ic 4 .5 4 growth for local lubricants. These workshops sell multiple
respectively. brands but promote the lubricants for which they get
Se m i-s ynt he t ic 2 .2 2
incentives and good margins.
The commercial-automotive segment is price sensitive, running on To t al 1 1 2 .1 100
low profit margins. Several transport and logistics companies in ⸺ FWS generally change oil after every 7,000 to 8,000
Vietnam, which are concentrated mostly in urban areas, engage in MAINTENANCE PRACTICES kilometers. IWS, on the other hand, change oil after every
stiff competition. Commercial fleet owners and transport companies 5,000 to 6,000 kilometers, since they usually use lower-
need to cut their maintenance costs and reduce their overall Commercial vehicles in Vietnam can be classified into two quality lubricants that do not enable longer ODIs.
operating costs to remain competitive in the market. categories: owner-operators and fleets. Owner-operators generally
use their vehicles for small businesses and own 10 vehicles or ⸺ The use of synthetic lubricants can substantially increase the
⸺ Conventional oils, which cost less, are used in most fewer. Fleets are usually run by large businesses that own and ODI, up to 10,000 kilometers. However, in the commercial
commercial vehicles. Even after government efforts to lower operate upwards of 10 vehicles. Large businesses also usually have automotive segment, synthetic lubricants are less often
the maximum age limit for operational vehicles, many better maintenance facilities. preferred because of higher prices than conventional
commercial vehicles in Vietnam are still old second-hand lubricants.
models imported from other countries that can make use of In order to maintain their commercial vehicles, owners/operators
generally make use of one of the three types of facilities: Large-fleet operators usually have in-house maintenance facilities
conventional HDMO.
independent workshops (IWS), OEM franchised workshops (FWS), for their vehicles. In such instances, either the driver or hired
⸺ The demand for semi-synthetic HDMO is growing, although or in-house maintenance facilities. maintenance staff is responsible for the oil change and other
at a slow pace, as taxis and light-duty vehicle operators have maintenance services. Sometimes, a few fleets or owner-operators
begun using semi-synthetics to improve the performance of IWS are privately-owned service providers and not affiliated with might contract with an IWS for maintenance services. The choice
their vehicles. any OEM or lubricant supplier. They are a leading channel for and procurement of lubricant brand is decided by the vehicle
maintaining out-of-warranty commercial vehicles. IWS are owners, whether they have an in-house facility or a maintenance
⸺ The use of imported off-highway equipment, premium buses, preferred by commercial vehicle owners over other installed service contract.
and trucks equipped with exhaust gas recirculation providers as they can offer all types of maintenance services, such
technology contributes to the gradually growing demand for as oil change, at a convenient location. Service prices at an IWS are
synthetic and semi-synthetic HDMO. Expanded use of such generally lower than at an FWS.
vehicles is expected to boost the demand for these lubricants
over the forecast period. Owners and operators of vehicles within the warranty period
usually prefer FWS over other service providers. OEM
recommendations are strictly followed at such facilities, and
maintenance services during the warranty period are covered in the
selling price of the vehicle. Not following OEM recommendations
during the warranty period generally leads to the loss of warranty
protection.
Commercial Automotive Lubricants (continued)
The commercial-lubricants segment is Vietnam was led by BP, Petrolimex, and Shell. The three companies ES TIMATED S ALES OF COMMERCIAL AUTOMOTIVE
combined held a share of 56% of overall commercial-lubricants demand in Vietnam in 2019. LUBRICANTS IN VIETNAM BY LEAD ING S UPPLIERS , 2 0 1 9
⸺ BP met around 31% of the demand for commercial lubricants. The company entered the Vietnamese S UPPLIERS KILOTONNES % OF TOTAL
market in the 1990s and built a strong brand image for itself. It enjoys high visibility and big BP 4 0 .3 31
distribution-channel network in Vietnam. BP offers its lubricants in Vietnam through Castrol BP Pe t ro lim e x 1 8 .3 14
Petco, a joint venture between BP and Petrolimex.
She ll 1 4 .3 11
Petrolimex was the second-largest supplier of commercial automotive lubricants, meeting around 14% of Che vro n (Ca lt e x) 1 1 .7 9
the demand in 2019. Petrolimex enjoys a unique advantage in the Vietnamese market, since it owns or
To t a l 1 0 .4 8
franchises many fuel stations nationwide, which is a key channel of distribution to truck owners/operators.
As of 2019, the company owned 5,200 fuel stations, with a presence in all 63 provinces in the country. In Id e m it s u Ko s a n 9 .1 7
2019, Petrolimex has also launched self-service fuel stations in HCMC. Me ko ng Lub e 2 .6 2
⸺ Fleet owners/operators generally have credit terms with fuel stations for purchasing lubricants and APSP 2 .6 2
fueling their vehicles. Petrolimex distributes Euro IV and Euro V diesel fuel at some of its stations, Nikko (Phúc Thà nh) 1 .3 1
which attracts all the newly manufactured vehicles requiring those fuels. All o t he r-a 1 9 .5 15
⸺ These fuel stations primarily sell Petrolimex-branded products. The company also provides low-end To t al 1 3 0 .1 100
lubricants, which are preferred by consumers because of their lower price, for older vehicles. As a a - Inc lud e s FUCHS Pe t ro lub SE, Mo t ul (Vilub e ), PTT, Va lvo line , PV
result, the low-end commercial-lubricant sector is led by Petrolimex. OIL, a nd ENEOS a m o ng o t he rs .
Shell was the third-largest overall supplier and the second-largest multinational supplier of commercial
automotive lubricants in Vietnam in 2019. The company reportedly offers more competitive prices than
most multinational suppliers, which has helped it gain market share.
Local suppliers are giving stiff competition to multinational suppliers; multinationals are not able to
compete with the low prices offered by local businesses. Regional and small-scale lubricant suppliers sell
primarily to semi-urban and rural areas. Their prices are lower compared to similar products supplied by
multinational suppliers, and they offer higher margins to retailers and distributors. This factor motivates the
retailers to promote local brands.
In 2019, the fourth and fifth spots were occupied by Chevron and Total, respectively. Chevron and Total
have been offering various discount schemes to lure the market away from local suppliers.
Commercial Automotive Lubricants (continued)
9%
10%
0.05
3%
0%
Trucks Buses Taxis-a Agriculture Construction Mining
a- Passenger vehicles used for commercial purposes.
On-highway Off-highway
PACKAGING Vietnam spans about 1,650 km from north to south. As the population density is high, the demand for road
transportation is also high. The construction industry has been developing robustly, and such factors help to
Dealerships purchase lubricants in bulk packages. These deliveries are usually made to the customer’s the improve the commercial vehicle parc.
storage facility. Typically, 5,000 liters of lubricant can be classified as a bulk purchase. FWS procure
relatively small packages of 200 to 2010 liters. Other major upcoming road-construction projects initiated by the Ministry of Transport include the
following:
Because of their low lubricant demands, small to medium-size IWS prefer purchasing small barrels, called
truck pails in Vietnam, that come in sizes of approximately 18 to 20 liters per barrel. Retail channels usually ⸺ In 2017, the Vietnamese government approved a plan to build a 1,372-km (852 mile) north-south
stock truck pails, barrels, smaller bottles for single use (0.8 liters and 4 to 5 liters). Greases are generally expressway from Hanoi to HCMC at a cost of more than VND 312.0 trillion (USD 13.8 billion). The
sold in containers with capacities from 0.5 to 5 kilograms. Gear oil is available in both small bottles and first phase is scheduled for completion by 2022, while the second and third phases will be finished by
tubes that can be squeezed to reach the rear areas of the vehicle. 2030, according to the plan. This will further stimulate demand for more commercial vehicles and
related equipment.
⸺ A 130-km two-lane expressway connecting Can Tho City with Ca Mau City is planned. The
MARKET DEVELOPMENTS construction work on this project is expected to be carried out between 2025 and 2030.
Commercial lubricant demand grew by 1.9% in 2019 over 2018. It registered growth despite a dip in
commercial vehicle sales. Vietnam registered strong growth in industrial output, leading to the demand for
commercial automotive lubricants for goods carriers. Development of public transport
Vietnam is heavily reliant on private vehicles, with approximately a 90% share. Public transport accounted
for 10% of demand. The government is planning to develop public transport to reduce roadway congestion.
Development of road infrastructure
⸺ Under the transport development plan for HCMC rolled out by the government, worth USD 155.8
Rapid economic growth has resulted in large numbers of vehicles choking the roads with traffic jams. The million, the city will have a comprehensive bus network by 2030, metro lines, and rail routes. The
country has been working toward improving its transport infrastructure and on strengthening other modes efforts to develop public transport will boost the demand for buses.
of transport, such as rail, air, and marine, to reduce the high dependence on road transport.
⸺ The government announced its infrastructure plan in 2016, which includes developing roads in 14
underdeveloped provinces and the investment of around USD 409 million to build more than 4,000
bridges by 2021.
⸺ In 2018, the government approved an investment plan worth USD 921.0 million aimed at improving
the infrastructure in the country. It involves the construction of 250 kilometers of new roads, new
wastewater treatment works, and drainage systems. The Asian Development Bank approved a USD
188 million project to enhance 198 kilometers of roads in in Vietnam’s northwest region.
Commercial Automotive Lubricants (continued)