INTRODUCTION

At its eighth national congress in 1996, the Communist Party of Vietnam (CPV) set the target of turning Vietnam into an industrialized economy by 2020. However, in April 2016, National Assembly Chairwoman Nguyen Thi Kim Ngan acknowledged that Vietnam would not be able to achieve that goal. Documents of the CPV's twelfth national congress in January 2016 also acknowledged this failure. Specifically, the political report of the congress replaced the target of “creating foundations to turn the country into a basically modern and industrialized country by 2020” in the eleventh congress's political report by “creating foundations to turn the country into an effectively modern and industrialized country soon”. The replacement of the deadline “by 2020” with the vague term “soon” reflects the Party's more realistic view of the economy as well as its cautious assessment of the country's industrialization prospects.

Among the reasons for Vietnam's failure to achieve the goal was its inability to grow a strong local manufacturing base and develop key strategic industries to provide a strong momentum for the country's industrialization. The automotive industry is one of the primary examples. Despite repeated efforts, Vietnam's automotive industry has been based mainly on a handful of assembling facilities, and supporting industries have remained largely undeveloped.

Recently, Vietnam's hopes for an indigenous automotive industry were rekindled when Vingroup, the country's largest private conglomerate, started in September 2017 the construction of a manufacturing complex in the northern city of Hai Phong and announced plans to develop a national car under the brand of Vinfast. Within a year, Vinfast managed to develop two prototypes, a sedan and a sport utility vehicle (SUV), which debutted with great fanfare at the 2018 Paris Motor Show. The company plans to put its first cars on the market in 2019.

While it is still too early to tell whether Vinfast will be successful, the way the company is rolling out its strategy, the great potential of the Vietnamese car market, the strong support that the Vietnamese government is lending the company, and the generally positive reception the Vietnamese public has shown for its first models, have all given rise to the hope that Vietnam will eventually be able to develop its own automotive industry. The impetus shown by Vinfast, if sustained, may also become a significant landmark along Vietnam's economic development and industrialization path.