Last year Vietnam imported 1,565 vehicles of all types from China, down 87 percent from 11,800 in 2017, according to a recent report by the Ministry of Industry and Trade.

This year only around 900 cars were imported in the first eight months, it said.

"Vietnam mainly imports trucks from China, while demand for these vehicles is increasing. The country is importing vehicles with less than nine seats from ASEAN, benefiting from zero percent import tariffs."

Under the ASEAN-China Free Trade Agreement, Chinese completely built unit (CBU) cars are subject to tariffs of 47-70 percent, and so they are at a price disadvantage against intra-ASEAN imports, the ministry said.

ASEAN accounted for 88.8 percent of car imports in 2018, and China for only 1.9 percent. 

Vietnam produces light trucks and assembles heavy trucks. The registration tax for pickup trucks have been increased to 6-7.25 percent in some places from the previous 2 percent. So imports of these categories of vehicles have slumped.

But Tuan Nguyen, who runs a dealership of Chinese cars, said imports from China, especially of those with less than nine seats, could pick up again by the end of the year as manufacturers there have upgraded their factories to meet Euro 6 emission standards as required by Vietnam.

The ministry has forecast Vietnam could pay a record $3.4 billion for imported cars this year, and a continuing trend of rising imports. In the first eight months over 96,000 CBU units worth a total of $2.1 billion were imported.