Vietnam remains heavily dependent on imported machinery and equipment to support its manufacturing base. At the same time, it has become an increasingly important exporter of machinery products, driven by foreign-invested manufacturers expanding production to serve both domestic and global markets. The country is gradually moving beyond being solely a machinery importer towards becoming an important manufacturing and export base for machinery and industrial equipment.
The industry has distinct capability gaps that vary significantly by subsector. This insight looks at where the industry currently stands, how it is structured, where investment is concentrated geographically, how local capabilities have matured and what the rules of origin requirements mean for machinery exports.
Vietnam’s machinery and equipment trade position
In 2025, Vietnam imported USD 61.02 billion in machinery, instruments and accessories, making it one of the largest machinery import markets in Southeast Asia and the country’s second-largest import category overall, accounting for 13% of total import turnover. Exports of machinery and instruments reached over USD 59 billion in the same year, with the United States accounting for USD 24.1 billion, followed by the EU at USD 7.1 billion, China at USD 5.5 billion, ASEAN at USD 3.8 billion and South Korea at USD 3.2 billion.
This near-symmetry between import and export values reflects Vietnam’s dual role in global manufacturing. The country imports large volumes of production equipment to support its industrial base, while its manufacturing sector produces and exports machinery, instruments and related products. These exports include assembled electronics, precision components and automation subassemblies. The sector is therefore both a consumer and a producer, and investors should be clear about which side of that dynamic they are entering.
More than 70% of machinery and equipment used in Vietnamese industry is still imported, primarily from China, Japan and South Korea. This continued reliance on imported equipment points to sustained and relatively visible demand for industrial technology, particularly in areas such as industrial automation, precision tooling and CNC systems. For investors, this creates opportunities both in machinery supply and across Vietnam’s growing manufacturing base.
Download the full industry report Vietnams Next Manufacturing Frontier (2026) | Acclime Vietnam to explore more insights about Industrial machinery and equipment in Vietnam.
How the industry is structured
Vietnam’s M&E industry spans three primary subsectors with distinct maturity levels: agricultural and farm machinery, construction machinery, and industrial machinery and equipment. Understanding where local capability is deep and where it is thin is the starting point for any investor assessing entry.
Agricultural machinery
Agricultural machinery is Vietnam’s most developed domestic segment. The processing demands of the Mekong Delta, such as rice milling, coffee drying and aquaculture feed systems, have built a genuine local industry in harvesting, sorting and post-harvest equipment. Several Vietnamese manufacturers have established export presence in Southeast Asia. This segment benefits from government R&D incentives and is a policy priority as Vietnam pursues agricultural modernisation. Adoption of high-tech farming machinery remains low relative to the sector’s GDP contribution of 11.64% in 2025.
Construction machinery
Construction machinery holds the dominant market share within the equipment type segment, driven by continuous government infrastructure investment in roads, bridges, expressways and urban development. The government’s North–South high-speed rail project and ongoing expressway expansion programmes sustain structural demand in this category well into the 2030s. The market is served primarily by imported equipment (Caterpillar, Komatsu and Hitachi Construction Machinery) with local players focused on maintenance, parts distribution and light fabrication.
Industrial machinery and equipment
Industrial machinery and equipment, the highest-complexity and fastest-growing subsector, is where the capability gap is most visible and where the most durable investor opportunity exists. CNC systems, robotic welding lines, conveyor automation, vision inspection and precision tooling are almost entirely imported.
The notable players in Vietnam’s industrial machinery market include Siemens Vietnam, ABB, Mitsubishi Heavy Industries, Doosan Vina, Bonfiglioli and FPT Industrial Machinery, alongside domestic players such as Vinacomin Machinery JSC and THACO Industries, which concentrate on less complex fabrication and assembly.
Geographic concentration of projects
Investment projects in machinery and equipment are distributed across all three of Vietnam’s economic regions. The North commands the highest concentration, with over 50% of investment projects and the largest share of capital. Bac Ninh, Hai Duong, Hai Phong and Hung Yen draw the most M&E activity in the north, anchored by the Samsung and LG electronics supply ecosystems that create consistent demand for production automation and precision components.
The south ranks second in project count but third in capital. The profile reflects smaller-scale foreign investment projects, particularly in Binh Duong, which is positioned as an active growth zone for the near term. The expanded Ho Chi Minh City administrative region, incorporating former Binh Duong and Ba Ria–Vung Tau provinces following the July 2025 merger, now represents the single largest contiguous industrial zone cluster in the country. It has deep-sea port access through Cai Mep Thi Vai.
How local capabilities have matured
A decade ago, Vietnamese factories were almost entirely dependent on imported tooling, spare parts and maintenance expertise for any equipment beyond basic mechanical fabrication. This dependency has decreased over the past decade, driven by the growth of domestic metalworking capacity. A dense network of metalworking SMEs, offering stamping, forging, casting, machining, cutting and welding, now provides the component and spare-parts supply chain that sophisticated assembly operations require. The steel inputs feeding this network come primarily from domestic producers Hòa Phát, Formosa Ha Tinh and POSCO Vietnam, whose flat steel and coiled sheet capacity underpins the mechanical engineering and equipment manufacturing supply base.
At the higher end, foreign-invested manufacturers have built genuine process depth in sub-assembly of electronic components, precision stamping for automotive parts and quality-controlled fabrication for export programmes. The gap that remains is in software-integrated systems, advanced automation programming and original equipment design. Vietnamese firms can execute to specification at high quality, but with limited exceptions, original design work still sits with foreign partners.
The skilled labour constraint quantifies this gap precisely. As of 2024, only 23% of Vietnam’s manufacturing workforce is classified as skilled in the operation and maintenance of high-tech machinery, according to ILO data. Government-sponsored training programmes have expanded, but the pipeline has not kept pace with the speed of FDI-led manufacturing growth. For investors in precision or automation-intensive M&E manufacturing, workforce development is not a soft benefit. It is a hard operational requirement in project planning from day one.
Why origin classification defines export economics
For machinery and equipment exports, rules of origin requirements set a strict threshold for what qualifies as Vietnamese-origin. The core principle across EVFTA, CPTPP and RCEP is that origin cannot be conferred by simple or minimal operations. The following are explicitly insufficient to establish Vietnamese origin under any of Vietnam’s major FTAs:
- Repacking or relabelling
- Basic assembly from imported components
- Quality inspection
- Simple cutting
Customs authorities have become meaningfully more stringent on anti-circumvention enforcement, a direct response to concerns about Chinese goods being routed through Vietnam to capture US or EU tariff treatment. M&E manufacturers importing heavily from China and exporting with claims of Vietnamese origin face a rising probability of investigation and retroactive duty assessment. In cases of documented fraud, this can extend to criminal liability and loss of export market access. In practice, an origin claim only holds up if the production process could withstand a factory audit by the destination country’s customs authority.
What this means for foreign investors
Vietnam’s industrial machinery and equipment sector does not fit a generic emerging-market read. It is deeply import-dependent at the capital equipment level, rapidly building at the sub-assembly and components level and structurally driven by one of Asia’s most sustained FDI-receiving manufacturing economies. The 2025 regulatory reforms have raised the analytical requirement for investors: CIT planning, origin qualification and licensing sequencing. They have not, however, reduced the underlying investment case.
At Acclime, our team supports industrial machinery investors across the full course of establishing and running operations in Vietnam. This includes entity structuring and investment registration, industrial zone selection and incentive qualification and employment compliance and work permits for the technical specialists who commission and maintain production lines. We also handle the accounting, tax and payroll functions that keep a plant compliant once it is running.
Contact Acclime to discuss how these developments may affect your business or investment plans.
- Rizwan Khan – Managing Partner – khan@acclime.com
- Vlad Savin – Partner – savin@acclime.com
- Thao Nguyen – Senior Manager, Licensing and Corporate Secretarial – nguyen@acclime.com
- Phuong Nguyen – Senior Manager, Payroll and HR Consulting – nguyen@acclime.com
- Mai Vu – Director, Accounting & Tax – vu@acclime.com
