Not so long ago, Vietnam’s streets were dominated by a chaotic ballet of scooters and motorbikes, weaving through traffic in a choreography both terrifying and hypnotic. Cars were a luxury, seen more in the driveways of government officials and the country’s burgeoning elite than in the homes of average families. Yet in just over a decade, the nation has shifted gears. Today, Vietnam is poised to overtake the Philippines to become ASEAN’s fourth-largest car market — a transformation that speaks volumes about its rapid economic ascent and changing aspirations.
In the second quarter of 2025, Vietnam’s car sales surged by 18 percent, reaching 90,772 units. The figure is slightly below the 20 percent growth rate the country had sustained over the previous four quarters, but it remains one of the fastest expansions in the region. This growth is unfolding despite the shadows cast by the Trump administration’s tariffs, which some manufacturers feared might dampen exports. Instead, Vietnam’s outbound shipments to the US have proven remarkably resilient, a testament to the country’s agility in navigating shifting trade winds.
From Motorbikes to Sedans: A Shift in the National Imagination
For decades, the motorbike was not just transportation in Vietnam; it was freedom, mobility, and livelihood all rolled into one. Cities like Ho Chi Minh City and Hanoi were shaped — even defined — by the endless hum of Honda Waves and Yamaha Nouvos. The idea of a “car culture” felt distant, almost Western. But rising incomes and an expanding middle class have brought a change in what Vietnamese families aspire to own.
Vietnam’s GDP grew by 7.52 percent in the first half of 2025 — the highest in 15 years — and with it, household purchasing power has expanded. Families who once measured their prosperity by the number of motorbikes they owned are now thinking about SUVs, crossovers, and sedans. The car has become a new marker of social mobility, a tangible sign that life has moved beyond mere subsistence.
VinFast and the EV Revolution
No company embodies this shift more than VinFast, the national electric vehicle manufacturer. In 2024 alone, it sold 87,000 electric vehicles domestically — an extraordinary feat for a brand that only began operations in 2017. Backed by Vingroup, Vietnam’s largest conglomerate, VinFast has managed to tap into both nationalist pride and the global EV wave. Its rise mirrors Malaysia’s Perodua and Proton in their formative years, but with a sharper, more modern edge: electric, connected, and designed for a world where climate concerns are reshaping consumer preferences.
VinFast’s success has also had a catalytic effect on the broader industry, forcing competitors — both foreign and domestic — to up their game. Japanese and Korean automakers have expanded their hybrid and EV offerings in Vietnam, while Chinese brands have entered with aggressively priced electric models, hoping to capture the urban youth market.
An Economy on the Move
Vietnam’s economic transformation has been one of Southeast Asia’s most remarkable stories. Since joining the WTO in 2007, the country has harnessed its young workforce, strategic location, and political stability to attract manufacturing investment from global giants. The trade war between the US and China only accelerated this trend, as companies sought to diversify their supply chains away from China. The automotive sector, once a peripheral player in Vietnam’s industrial strategy, has benefited from the same momentum that made the country a hub for electronics and textiles.
Today, car sales growth is supported not just by rising incomes, but by infrastructure improvements — new highways, expanded urban ring roads, and better public utilities. These developments have made car ownership more practical for a broader swathe of the population. The Vietnamese government’s push for green mobility, through EV incentives and urban transport reforms, has further encouraged consumers to consider their first car purchase an electric one.
The Road Ahead
If current trends hold, Vietnam will soon leave the Philippines behind in the rearview mirror, claiming the title of ASEAN’s fourth-largest car market. This is not just a statistical milestone. It is evidence that Vietnam’s long economic climb — from post-war isolation to global integration — is entering a new phase. Cars, once the preserve of a few, are becoming part of the national landscape, just as motorbikes once defined it.
The implications go beyond the showroom. A stronger car market will deepen Vietnam’s manufacturing base, create new jobs, and alter the physical shape of its cities. But it will also bring challenges: traffic congestion, environmental concerns, and the question of how to balance rapid motorisation with sustainable growth.
For now, though, Vietnam is accelerating — fuelled by a confident middle class, an ambitious homegrown EV champion, and an economy that seems determined to keep breaking its own speed limits. The hum of scooters will still fill the air for years to come, but the rumble of engines — and the quiet whirr of electric motors — is fast becoming part of the soundtrack of modern Vietnam.
