Car sales affected by delay in YVQC: Volvo

Volvo, the Gothenburg-headquartered car manufacturer, said that the government’s delay in implementing the new vehicle registration system in Yangon has caused a significant impact on its sales.

If the Yangon regional government can implement the new system, known as Yangon Vehicle Quota Certificate (YVQC), by June, Swedish Volvo Car Group could double its sales in Myanmar within this year, according to general manager of Volvo Car Myanmar Temmy Wiradjaja.

Mr Wiradjaja made the comments last week at the launch of the new Volvo XC40 premium small SUV for the Myanmar market.

Volvo entered the Myanmar market in February 2017. It also appointed Performance Auto International Co Ltd, a joint venture between UMG Co Ltd and Wai Family Co Ltd, as importer and distributor of its vehicles in Myanmar.

Since then, the company has sold 54 units and now dominates a 20pc share of the new car market, Daw Nway Nway Hlaing, director and CFO of Volvo Car Myanmar, said. All Volvo cars to Myanmar are directly imported from Sweden, the Scandinavian country.

“Myanmar is one of fast growing markets in the APAC region for Volvo,” said Hiroshige Ishigure, market area director of Volvo in Asia-Pacific.

New policy

Nevertheless, the government’s changing automotive import policies have capped the car maker’s sales, as most customers have delayed their purchases in view of the uncertainty.

Most recently, the government said it will implement the YVQC system in Yangon to replace the existing system of using parking recommendation letters to purchase a vehicle.

The YVQC system is similar to the Certificate of Entitlement (COE) system used in Singapore. Under this system, the YVQC is the quota licence received from a successful winning bid in an open bid uniform price auction. The certificate grants holders the legal right to register, own and use a vehicle for a fixed period.

So far though, this new system has yet to be implemented in Yangon. “The government made the announcement in March that they will implement YVQC in April. We waited but this has not happened. Now their latest update is that the new system will be carried out in July.

“This delay has affected our sales a lot because the customers are holdings off their purchase,” said Mr Wiradjaja.

If the government implements the YVQC by June, Volvo estimates it could sell 100 units within this year. The car maker is also planning to launch its second showroom in Myanmar soon.

Industry problem

Volvo isn’t the only one frustrated over the policy delays. Last week, the American Chamber of Commerce Myanmar (AmCham) and the European Chamber of Commerce in Myanmar wrote formally to the commerce and transport ministries to complain about the delay in implementing YVQC.

The letters, seen by The Myanmar Times, said that the two chambers were concerned about the delay in the implementation of the new system.

Vehicle distributors and dealers have been waiting for two years for a new policy. The new system was originally expected to be in place by the beginning of April but the authorities have delayed its implementation without providing a timeline.

The current delay poses a “significant impact on sales since Yangon is the largest market in the country for our respective vehicles,” the chambers wrote.

They further argued that the lack of information on the timing has created ambiguity and confusion in the market.

Source : Myanmar Times

To see the original article click link here

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, “Puma Energy”, “MOGE”, “yangon new town”,”MECTEL”, “hydropower”, etc.

.

Looking for foreign investors to invest in your business in Myanmar