Could Tungsten Help Revive Vietnam’s Automobile Industry?

For Vietnam’s automobile industry, it is very important to increase the localization ratio and reduce production costs. And as the largest output of mines in the country, could tungsten mines be the springboard for the auto industry?

Sumito Ishii, CEO of General Motors Vietnam, said that high costs are weakening domestic manufacturers’ competitiveness. The auto production cost in the country is 10-20 percent higher than in Thailand and Indonesia because of the high number of imported car parts. 

Vietnam’s automobile industry, after 20 years of development, still cannot reach the targeted localization ratio. The locally made content of cars with up to 9 seats is 7-10 percent, far below the targeted ratios of 40 percent by 2005 and 60 percent by 2010.

Over 90 percent of component suppliers are foreign invested companies. However, Vietnamese enterprises keep making hefty investments in automobile manufacturing projects, with the aim of becoming an automobile production center in SE Asia.

The urgent need for clean fuels for vehicles has prompted automobile manufacturers to research, test and apply various types of materials for automobile manufacturing. With this trend, tungsten has become an attractive material for the automobile industry.

Vietnam automobile industry picture

Automobile manufacturing consumes the most tungsten, with 25 percent of global output, according to Bloomberg. 

Tungsten, a hard, heavy metal, with a high melting point and good corrosion resistance, is an essential part in the auto industry.

For a cleaner environment, scientists believe that lead must be replaced step by step in industrial production. The metal ranks second on the US government’s list of most hazardous substances.

Tungsten is the heaviest chemical element known to be biologically active. Its toxicity is low compared to other metals.

Because of the similarity of molecular density, tungsten has been proposed by scientists as a possible alternative for lead. However, tungsten has a higher cost and it is more difficult to process than lead.

However, tungsten polymer composite is a mixture of plastics types and tungsten powder. Once they are mixed, thermoplastic tungsten is created. Such materials are very flexible, with no toxic components, and are erosion resistant in different weather conditions.

It is expected that tungsten demand will continue rising in 2018 and the price of tungsten composite will increase due to high demand for alternatives for lead. If this occurs, domestic automobile manufacturers in Vietnam would benefit, because the country is the second largest tungsten exporter, just after China.