Under a proposal from the Ministry of Construction, automakers in Vietnam may be required to meet an average fuel consumption limit of 4.83 liters per 100 kilometers for all vehicles sold by 2030. If this standard is not met for three consecutive years, manufacturers may be forced to suspend production, assembly, and imports until a compliant plan is submitted.

According to the World Bank (WB), Vietnam is accelerating its efforts to meet commitments made at COP26, aiming to achieve net-zero carbon emissions by 2050. Under its national climate strategy, the country targets at least a 43.5% reduction in greenhouse gas emissions by 2030 with international support and plans to increase the share of renewable energy to nearly 50%.

“The Vietnamese government is actively implementing energy transition plans, encouraging electric vehicle use, expanding green public transportation, and developing a carbon market. These strategic steps are intended to ensure both economic growth and international climate responsibilities,” the World Bank noted.

As part of its roadmap to reduce emissions in the transport sector, the Ministry of Construction is drafting a new National Technical Standard and seeking public and stakeholder feedback.

The Ministry proposes that automakers must comply with Corporate Average Fuel Consumption (CAFC) limits for their entire passenger car fleet, with the target set at 4.83 liters per 100 km by 2030.

If a manufacturer exceeds this threshold, they can purchase offset credits from other companies that fall below the limit. However, after three consecutive years of non-compliance, manufacturers may be ordered to halt production, assembly, and imports until a suitable compliance plan is in place.

This mechanism is similar to the global carbon credit trading system. It aims to encourage automakers to innovate, phase out fuel-intensive vehicle models, and increase the production of green-energy vehicles.

The Vietnam Automobile Manufacturers Association (VAMA) commented on the draft, stating that based on their research, with the 4.83-liter target, 96% of current gasoline-powered vehicles and 14% of hybrid vehicles on the Vietnamese market would not meet the standard.

To address this, VAMA recommends a more realistic CAFC target of 6 liters per 100 km by 2030 - about 1.2 liters higher than the Ministry’s proposal.

VAMA argues that this target would still enable Vietnam to reduce 15.66 million tons of CO₂ emissions by 2030, as committed in its 2022 Nationally Determined Contribution (NDC), including a 9% unconditional and 27% conditional reduction in emissions. Moreover, this approach would minimize market disruption compared to the stricter 4.83-liter scenario.

Even under the adjusted target, automakers would still need to significantly shift their production mix, reducing gasoline-powered vehicle output by around 34% and increasing electric vehicle production by at least 366%. However, this route is deemed more feasible.

The American Automotive Policy Council (AAPC) also supports a target of 6 liters per 100 km by 2030, recommending the stricter 4.83-liter threshold be considered starting in 2035.

AAPC further suggested that the draft regulation should include detailed CAFC benchmarks by vehicle category, as certain types - such as high-capacity passenger vehicles, diesel-powered pickup trucks, or four-wheel-drive models - may find it difficult to comply.

Meanwhile, the Japan Automobile Manufacturers Association (JAMA) echoed support for a 6-liter per 100 km CAFC target and proposed that the adjustment period for compliance be extended from three years to five. JAMA emphasized that developing electric and fuel-efficient vehicles typically requires a minimum of five years.

PV