Disadvantages of German goods in Vietnam

• Geographical distance: Germany is geographically located far from Vietnam, so despite being very strong in logistics services, the cost to transport goods from Germany to Vietnam is still higher than competitors near/close to Vietnam such as ASEAN or Asian countries. High transportation costs make the price inflated, while German products are inherently more expensive than that of other regions. However, with the development of transportation and logistics, costs for goods transportation from Germany to Vietnam in the future may be reduced. Moreover, tariff reduction under the EVFTA also helps German goods prices more competitive compared to many other competitors from non-FTA partners of Vietnam;

• High price: German products are often of good quality but high prices, thus only a few middle and upper-class consumers can afford. For Vietnamese enterprises, with more than 90% being small and medium, there are only a few large enterprises with large production and exports that have the ability to buy modern machinery and high quality raw materials. However, with the increasing number of high-income consumers and businesses exporting to developed markets, opportunities for German exports to Vietnam are still very potential.

Source: "Business Handbook: Exploiting the EVFTA  to import and export goods between Vietnam and Germany" - Center for WTO and International Trade

• Focal point of information about the Vietnamese market
• Main competitors of German goods in Vietnam
• Export turnover of German goods to Vietnam
• Main German goods exports to Vietnam
• Vietnam's demand for imported goods