Uber helps Vietnamese get car loans
In Vietnam, where motorbikes far outnumber cars, Uber Technologies Inc. is helping to create a new generation of auto drivers with first-time bank loans for vehicle purchases.
Vu Ngoc Hung traded his 12-year-old Taiwanese scooter for a brand-new $28,500 Honda after a lender financed 80 percent of his white four-door sedan on the basis of his Uber fares.
Uber's 3-month-old bank program is changing the Vietnam dream, which now includes a new automobile in a nation of 45 million motorbikes. After testing in a country where Toyota Vios sedans compete with scooters carrying a family of four down narrow avenues hazy from vehicle pollution, the initiative is being rolled out in other Southeast Asian markets.
"About 70 percent of car buyers borrowed money from banks last year," said Ho Minh Tam, vice chief executive officer of Viet Capital Bank. "Vietnamese spending behaviors have changed."
The program also opens up another front for Uber in its battle for ride-hailing customers and drivers. In Vietnam, the San Francisco startup competes with GrabTaxi Holdings Pte. like it battles Lyft Inc. in the U.S. and Didi Chuxing in China.
Vietnam had one of the fastest-growing auto markets in Asia during the past three years, according to Koichi Sugimoto, an analyst at Mitsubishi UFJ Morgan Stanley. The country's 2015 vehicle sales jumped 55 percent to 245,000 units, the Vietnam Automobile Manufacturers' Association reported. Half of vehicles sold were imported, according to the General Statistics Office in Hanoi.