In June 2019, Honda sold 148,382 cars in the Chinese auto market, a remarkable growth compared to last year of 37.4%. Both of its joint ventures in China hit record sales in the past month. GAC Honda grew 6.6% to 65,340 units while Dongfeng Honda increased sales 77.9% with 83,042 units sold.
In the first two quarters of the year, Honda's sales in China totaled 745,409 units, up 22.4% year-on-year.
In total, there are 6 models Honda CR-V, Civic, Accord, XR-V, Fit and Crider with sales in June exceeding 10,000 units. Sales of CR-V Hybrid and Accord Hybrid also increased by 86.4% (reaching 3,305 units) and 202.6% (reaching 2,648 units).
In the Vietnamese market
In the last fiscal year of 2019, Honda Vietnam has achieved record sales with 32,218 cars, the highest in the past 10 years, an increase of more than 150% compared to fiscal year 2018. This growth rate It was higher than the overall growth of the passenger car market, and also set a sales record since Honda Vietnam entered the Vietnamese auto manufacturing and trading segment.
This year Honda's new car sales in China dropped 10% to 113,430 units in April 2020. However, this reduction is much lower than the 50.8% decrease in March. The Honda Vietnam report said that the sales of auto segment in April reached 843 units of all types, down 57 % over the previous month and down 52% over the same period last year.
Based on the above data, it can be seen that Honda chain factories in China should not withdraw the factory to Vietnam. The impact of business activities in the process of globalization has a lot to do with Honda automobile business results in Vietnam. The introduction of many car companies into the Vietnamese market through free trade agreements. Vietnam's infrastructure structure is not good, tariff policies are still high, import and export processes are cumbersome in the operating process, customer choice is also affected by brands come from other manufacturers.
The proposed displacement products to Vietnam are also not flawed. In the short term, manufacturers may have difficulty moving production due to supply chain rearrangements. At the same time, companies often fall into the bipolar world when deciding to relocate and how to enter new schools. These issues will have a great impact on the competitiveness of businesses.
Therefore, businesses need to make wise decisions to keep production activities stable in a short time, while expanding business when necessary.
VIII. Global supply chain between Vietnam and China In China
The supply chain is most important to China's long-term development.
Firms lured by China's low production costs will redirect supply chains to cheaper locations. Over time, China's cost advantage has been eroded by rising wages and space costs and rising tariffs.
In contrast, firms wishing to enter China's vast domestic market are less likely to retreat. Recent surveys by the US and European chambers of commerce show that the majority of respondents have no intention of leaving China despite the trade war and the economic shock COVID-19.
For groups of businesses who come to China to take advantage of the comprehensive manufacturing ecosystem, whether to stay or stay is more difficult. On the one hand, the reasons for staying remain as strong as before: China's infrastructure, logistics network and skilled labor supply outperform those of emerging economies.
On the other hand, these benefits now need to be weighed against high tariffs, potential sanctions, technological constraints and mounting political pressure.
In Viet Nam
Vietnam is one of the developing countries, on the path of industrialization and modernization towards an open market, and along with the 4.0 revolution, supply chain management is an essential solution to increase competitiveness of Vietnamese goods in addition to improving product quality and services.
Emerging as a dynamic, open-ended economy in Southeast Asia, Vietnam needs to grasp the new trend of the global economy and improve its competitiveness.
However, the supply chain management industry in Vietnam has not been fully focused, the economy has not fully understood the importance of supply chain management in the production and distribution of products to consumers. . The manifestation is that there is no university or educational institution providing full and formal training in supply chain management; human resources in this industry are
always in shortage; There is not even a department within companies that deals with SCM; There are also quite a few companies in supply chain management.
Challenges
Only 25% of Logistics requirements are provided by domestic firms (SMEs), and the rest of the market share is “procured” by foreign firms. Currently, there are about 3000 Logistics enterprises of which about 1300 actively participate; There are about 6000 employees and 1 million workers working in the industry but only meet 40% of the actual demand.
If you look at the overall picture, it is clear that foreign businesses are in the above position, but domestic businesses also have many advantages: first, Vietnamese businesses own most of the warehouse, making business Foreign enterprises have to sub-lease or associate or enter into joint ventures to provide logistics services, secondly, domestic enterprises understand the market, customer psychology, culture and traditions of Vietnamese people; thirdly, Vietnamese human resources are quite quick to grasp foreign technologies.
Most logistics service providers are at 2PL or 3PL; Integrated logistics (4PL) and supply chain management are few and limited by capacity and service network
The World Bank's Annual Report ranks LPI (Logistic efficiency index), Vietnam ranks 39/160, up 25 places compared to 2015, ranks 3rd in Southeast Asia, but the international LPI The opinion department participating in the evaluation of the transporters, freight forwarders, logistics operators who have business relations with Vietnamese enterprises is not assessed by Vietnamese enterprises, so it is objective.
The transport infrastructure has not met the development needs of the SCM industry.
One of the biggest bottlenecks is that costs remain high, accounting for 25% of GDP, with the following factors being attributed to:
• Vietnam's infrastructure and transport systems are lacking and weak compared to the country's development requirements, especially underdeveloped roads commensurate with the speed of industrialization and urbanization of our country, leading to overload and congestion
• Although state management agencies are implementing many reforms to streamline administrative procedures and facilitate trade, in reality, there are still many difficulties in customs clearance procedures leading to slow rotation. freight, increase costs of businesses
• Inland sea transport has not fully utilized to reduce the load for road transport
• The linkage between ports and port services (warehouse, yard, logistics center) is still limited due to the lack of high-tech applications in logistics management and operation leading to much more expensive costs.
• Human resources are scarce, so it only meets the size of the business and is expensive in training human resources in this industry.
Solutions
To reduce costs for supply chain management in Vietnam, there are several measures as follows:
• Reduce transportation costs
• Professionalization of human resources
• Integrated traffic planning
Vietnam is a country with great development potential, so it receives a lot of investment from large retailers in the world. In fact, the expansion of foreign enterprises has made it even more difficult for domestic enterprises that already face many difficulties to find customer markets because they cannot compete with big competitors. We are losing at home, because businesses have many outstanding advantages from capital resources, brands, goods circulation to high quality staff, large corporate governance model.
Vietnamese businesses are focusing on e-commerce channels because the growth potential of this industry is huge. This goal is facing many challenges such as lack of trust from consumers, the control of sources is not good, especially the process of building a model of product road management. from
production sites to consumers. The industry's biggest goal is to turn Vietnam into a regional Logistics Center; To do this, first of all, the Government must issue preferential policies, build modern bridge and road systems; After that, special attention must be paid to building high-quality human resources in this industry.
IX. Conclusion
In these days, globalization is affecting all countries of the world, with free trade, countries exchanging goods and information with each other and as a result traditional barriers between countries. the country is gradually being demolished and the world is becoming closer and closer.
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