Transport costs of cargo and passengers by road always have a huge impact on the price of other commodities and services, in which freight charges account for a large amount of expenditure of the state budget.

According to the Vietnam Business Forum, a weekly magazine of the Vietnam Chamber of Commerce and Industry, Auto transport rates generally are not controlled by the state. Enterprises carry out self-declaration on transport freight rates under the guidance of the Ministry of Finance which makes freight rates often fluctuate, or even not suitable to goods' price, directly affecting the operation of the whole society.
At the conference "Transport Costs in Vietnam" held by the Ministry of Transport recently in Hanoi, a representative from the Directorate for Roads of Vietnam stated that Vietnam now has about 11,000 transport enterprises including 8,000 specialising in freight transportation and 3,000 specialising in passenger transportation. Besides, there are a significant number of individuals and households operating in this field.

Most of the transport firms are running with a small scale, some of them own only one or two cars. It is quite hard for them to establish their brands because of their small scale; therefore, they mainly operate seasonally based on a modest quantity of patrons. Plus, small transportation firms become passive with passengers’ needs which leads to the fact that they cannot be proactive in making up business plan, thus, the efficiency of using means of transportation is not high.

Besides, the small-scale transport brands do not often have business networks or information channels to access to their customers. This restriction leads to low operational efficiency of cargo transportation as not carrying out two-way transportation as well as low operational efficiency of passenger transportation due to low tonnage coefficient.

According to Vietnam Automobile Transportation Association, passenger transport tariffs by cars along fixed routes, under the signed contract and tourists transport in Vietnam are 20 percent higher than that in Laos, Cambodia, Thailand, but lower than that in China.

Major freight companies in Hai Phong and Ho Chi Minh City also pointed out that now they perform freight shipping contracts under the agreements with goods’ owners in a particular time with flexible prices. In fact, current freight rates in Vietnam in recent times are unstable and higher in comparison with Vietnamese people’s livelihood and freight rates have an upward trend.

Deputy Minister of Transport Le Dinh Tho said that until now, there are no official statistics on the value of transportation in Vietnam’s annual gross domestic product (GDP). Currently, reliable scientific research data on Vietnam’s transport expenses is still uncommon and rarely published or used in the process of establishing mechanisms, policies or plans.

It is necessary to reduce transportation costs with the aim of decreasing prices of other products and services and ensuring social security.
According to the Vietnam Automobile Transport Association, to decline road transport costs, Vietnam needs to implement proper policies in regulating import tariffs towards road transport business. Price of cars, which suits areas, will have a positive impact on transport costs. Simultaneously, Vietnam needs to provide stricter business conditions to reorganise transportation firms; transport units with appropriate scales will reorganise their production in accordance with their conditions in order to reduce input costs.

The Directorate for Roads of Vietnam said Vietnam can build a “Freight Transport Trading Floor” as a tool to exchange information between transport companies and shippers in order to create market transparency, repair one-way transportation, increase transport operational efficiency, reduce transport expenses and reduce the number of trucks on the roads.

Besides, it is possible to build a large-scale truck station system, goods’ wholesale and distribution in big cities or centres of goods production and consumption to collect small quantities of goods which need long-distance transportation into an enormous quantity to transport by heavy trucks. When the wholesale system is put into operation, it will help to minimise the transportation of long-distance goods by small trucks, decrease costs per unit of transporting outputs and reduce traffic density on highways.

In particular, representative of Directorate for Roads of Vietnam recommended that Vietnam should invest in upgrading road infrastructure to shorten road length and increase transportation velocity, thus, enhance capacity of cargo and passenger transport.-VNA