Vietnamese EV maker VinFast is reportedly set to launch an extended-range electric vehicle (EREV) hybrid in 2026. (Photo: Wikipedia Commons)
Starting in 2026, hybrid electric vehicles (HEVs) in Vietnam will be subject to an excise tax rate equivalent to 70% of that applied to conventional gasoline and diesel cars. Automakers expect the policy to significantly lower retail prices and stimulate demand, prompting not only Japanese, South Korean, and Chinese carmakers to step up their market push, but also new investments by domestic and Chinese players.
Vietnamese conglomerate Geleximco, in partnership with Chinese automotive giant Chery, plans to invest more than VND 8 trillion in building a new manufacturing plant focused primarily on new energy vehicles and hybrids.
Vietnam cuts Hybrid taxes, saving buyers nearly $2,800 per vehicle
In June 2025, Vietnam’s National Assembly approved amendments to the Law on Excise Tax, expanding preferential tax treatment for electrified vehicles. The incentives, previously limited to plug-in hybrid electric vehicles (PHEVs), will be extended to non-plug-in hybrid models (HEVs) that do not require grid charging. The revised law is scheduled to take effect on January 1, 2026.
