Upselling, demand for premiums returns to plague car market

When buying a Toyota Veloz Cross, a much-awaited multi-purpose vehicle with a price tag of VND650-690 million ($28,400-30,000), customers are urged to spend an extra of VND20-50 million on optional bundles if they want delivery this month.

If they opt not to, they have to wait until July for delivery.

Thanks to their popularity and high demand, Toyota vehicles have been sold by dealers using such dubious tactics often in recent years.

Toyota Vietnam claims its business policy is first come, first served and it does not “tolerate” dealers forcing customers to buy extras.

A Toyota Veloz Cross on a street of HCMC. Photo courtesy of Toyota Vietnam

“Toyota Vietnam requires all dealers to comply with our policy to protect customers’ interests. We are receiving feedback via our hotline and will take action if violations are found,” a spokesperson said.

This is not the first time the Japanese automaker has responded thus after its dealers took advantage of limited supply to line their pockets.

This is now spreading to other car brands and even motorbikes.

Customers buying Ford and Hyundai cars have to shell out VND20-100 million to get delivery soon, this amount often being just to speed up things and not for extras.

Dealers are also demanding a 10-20 percent premium for popular motorbikes like Honda’s SH, Air Blade and Future.

But insiders and experts said it is not easy to stop such tactics since there is no overt violation of the law.

“Carmakers and dealers are independent entities, and prices are governed by supply and demand,” Huynh Phuoc Hiep, a HCMC lawyer, said.

“Once both seller and buyer agree on the price, it is impossible to say who is right and who is wrong”.

Vinh Nam, an experienced luxury car dealer in HCMC, said this does not happen in Vietnam alone, and in the U.S. too customers pay for extras if they want the car sooner.

Dealers said they have to commit sales of not just cars to manufacturers but also of parts and other extras.

Besides, they could not sell just popular cars, meaning they have to make the most out of best-selling models to offset costs and make profits, they said.

Vietnam’s auto sales in March returned to growth with a 17 percent increase year-on-year to 36,962 units after two consecutive months of decline, according to Vietnam Automobile Manufacturers Association (VAMA).

The figure was highest this year and brought sales in the first quarter to 90,506 units, up 27 percent year-on-year, said VAMA, which does not incorporate data of VinFast and TC Motor (assembler of Hyundai cars).