Vietnam Autonomous Vehicles Market Outlook to 2030

Vietnam Autonomous Vehicles Market Overview

• Vietnam Autonomous Vehicles Market has experienced significant growth over recent years. This is reflected by Global Autonomous Vehicle Market which reached a valuation of USD 80 billion, driven by the increasing demand for advanced driver-assistance systems (ADAS) and rising investments in technology development by key players.
• Key players in the Vietnam Autonomous Vehicles Market include prominent names such as VinFast, FPT Corporation, TMT Motors, and Viettel. These companies are investing heavily in research and development to advance autonomous vehicle technology and focusing on product innovation to gain a competitive edge in the market.
• In 2024, VinFast has unveiled a concept vehicle called the VF Wild EV Truck at CES 2024, which features Level 4 autonomous driving capabilities using the Mobileye Drive platform which includes advanced connectivity and safety features.

Vietnam Autonomous Vehicles Current Market Analysis

• The impact of the autonomous vehicles market in Vietnam is profound, revolutionizing the transportation sector by improving road safety, reducing traffic congestion, and lowering emissions. The adoption of autonomous vehicles is expected to decrease traffic accidents and reduce carbon-dioxide emissions, contributing to a cleaner and safer environment.
• One of the significant challenges facing the Vietnam Autonomous Vehicles Market is the lack of robust infrastructure to support autonomous vehicle operations. Despite government efforts, the development of necessary infrastructure lacks, such as smart roads and communication networks is lagging.
• Ho Chi Minh City is currently dominating the Vietnam Autonomous Vehicles Market with a significant market share. The city's rapid urbanization, high traffic density, and proactive government initiatives make it a prime location for the adoption of autonomous vehicles.

Vietnam Autonomous Vehicles Market Segmentation

The Vietnam Autonomous Vehicles Market can be segmented based on several factors:

By Product Type: Vietnam Autonomous Vehicles Market is segmented by Product Type in passenger vehicles, commercial vehicles & others. In 2023, passenger vehicles reign as the most dominant sub-segment, holding a substantial market share. This dominance is attributed to the increasing consumer demand for safety and convenience features in personal transportation.

By Technology: Vietnam Autonomous Vehicles Market is segmented by Technology in Level 1, Level 2, Level 3 and Level 4. In 2023, Level 2 emerges as the most dominant sub-segment, commanding a significant percentage of the market share. This segment's dominance is due to the balance it offers between automation and driver control, providing enhanced safety features without fully relinquishing control from the driver.

By Region: Vietnam Autonomous Vehicles Market is segmented by region into North, South, East & West. In 2023, the South region dominated the market with a significant share. This region's dominance is driven by high urbanization rates, significant government investments in smart city projects, and a favorable regulatory environment for autonomous vehicle testing and deployment.

Vietnam Autonomous Vehicles Market Competitive Landscape

• VinFast’s Electric Vehicles: In 2024, VinFast delivered around 21,474 electric vehicles globally. The company remains optimistic about future growth due to strong pre-orders for upcoming models. VinFast is also expanding its production capacity with new factories in North America and Europe.
• FPT Co. and NVIDIA Collaboration: In 2024, FPT Corporation collaboration with NVIDIA worth $200 million to develop AI-driven autonomous vehicle solutions. This partnership aims to enhance the technological capabilities of FPT’s autonomous vehicle offerings.
• Wuling Cars by TMT Motors: In 2023, TMT Motors signed a strategic cooperation agreement with the joint venture of General Motors (GM) and SAIC – WULING. Under this agreement, they decided to provide components to TMT Motors to exclusively manufacture, assemble and distribute Wuling electric cars in Vietnam.

Vietnam Autonomous Vehicles Industry Analysis

Vietnam Autonomous Vehicles Market Growth Drivers

• Increasing Adoption of Smart City Initiatives: In 2023, Japanese trading company Sumitomo Corp and Vietnamese real estate developer BRG Group launched a $4.2-billion smart city project in Hanoi. Projects like this aim to enhance urban mobility and reduce traffic congestion in major cities such as Ho Chi Minh City and Hanoi, fostering the growth of the autonomous vehicle market.
• Rising Investments in Autonomous Vehicle Technology: In 2021, Phenikaa Group, a multi-sectoral corporation, has introduced its prototype of a level-4 autonomous vehicle, Vietnam's first smart self-driving vehicle. The vehicle is equipped with smart functions, artificial intelligence (AI). Such investments are expected to drive technological advancements and market growth in the coming years.
• Growth of Logistics Sector: In 2022, Vietnam has 34,476 logistics service enterprises, of which 89% are domestic enterprises. Autonomous vehicles offer significant benefits for logistics operations, including reduced delivery times, lower operational costs, and enhanced efficiency.

Vietnam Autonomous Vehicles Market Challenges

• Infrastructure Limitations: The lack of adequate infrastructure poses a significant challenge to the adoption of autonomous vehicles in Vietnam. Despite government efforts, the development of smart roads and communication networks has been slow, leading to delays in market adoption.
• High Development Costs: The high costs associated with developing and deploying autonomous vehicle technology remain a barrier. This financial burden which curbs the widespread adoption and commercialization of autonomous vehicles.
• Regulatory Hurdles: Navigating the complex regulatory landscape for autonomous vehicles is challenging. Although the Vietnamese government introduced new regulations in 2024, there are still ambiguities and inconsistencies. These regulatory challenges delay the deployment of autonomous vehicles and slow down market growth.

Vietnam Autonomous Vehicles Market Government Initiatives

• Master Plan for Transport Infrastructure: Announced in April 2021, the master plan involves significant investments ranging from USD 43 billion to USD 65 billion by 2030. This includes the construction of new expressways, high-speed rail lines, and the expansion of major airports. High-speed rail projects connecting key cities are part of this plan, which aims to improve national connectivity and support economic development.
• Railway Infrastructure Upgrades: In 2023, Vietnam is upgrading the railway line connecting Kunming, China, to Haiphong, Vietnam, as part of the Belt and Road Initiative. In addition, the development of autonomous vehicle technology is expected to complement these infrastructure upgrades by enabling more efficient and safer transportation solutions.

Vietnam Autonomous Vehicles Future Market Outlook

Vietnam Autonomous Vehicles Market is projected to continue its upward trajectory. This growth will be propelled by advancements in AI and machine learning, increasing urbanization, and government initiatives promoting smart city projects.

Future Trends

• Expansion of Autonomous Vehicle Fleets: Over the next five years, there will be a significant expansion of autonomous vehicle fleets in Vietnam. By 2028, it is estimated that there will be over 10,000 autonomous vehicles operating in major cities, driven by increased investments and favorable government policies.
• Integration with Smart City Infrastructure: Autonomous vehicles will become integral to smart city infrastructure in Vietnam. By 2028, major cities like Ho Chi Minh City and Hanoi are expected to have fully integrated autonomous vehicle systems, enhancing urban mobility and reducing traffic congestion. Investments in smart city projects are projected to reach USD 500 million by 2028.
• Advancements in AI and Machine Learning: The next five years will see significant advancements in AI and machine learning technologies, enhancing the capabilities of autonomous vehicles. By 2028, autonomous vehicles in Vietnam are expected to achieve higher levels of automation, improving safety, efficiency, and user experience.