Automation is revolutionizing the corporate world, and Vietnam is no exception. By definition, industrial automation in Vietnam refers to the use of robots, control systems, and digital technologies to manufacture products with minimal human intervention. As manufacturers scale their automation pilots into full production, engaging corporate secretarial services becomes essential to align procurement, tax-incentive claims, and hiring with local regulatory requirements.
Why Automation in Vietnam Is Surging in 2026
Automation in Vietnam has accelerated dramatically over the past few years. Between 2019 and 2021, about 10% of Vietnamese firms automated their operations. By the end of 2022, that number had jumped to over 25%.
Several factors are driving this rapid adoption:
- Clear government standards for automation: The government is pro-industrialization and has set clear standards and targets for Industry 4.0 adoption.
- High-technology adoption: Vietnam has swiftly transitioned from a traditional manufacturing base to one that embraces high technology.
- Cost-effective labor combined with automation: While labor costs remain competitive, automation cuts production expenses further.
- Booming electronics sector: Vietnam is now a leading electronics exporter, driving demand for automation in Vietnam to maintain quality at scale.
- Financial incentives: The government actively incentivizes automation through tax policies and investment support.
Vietnam invested approximately 5.7% of its GDP in infrastructure in early 2020, ranking 39th out of 160 nations on the World Bank’s Logistics Performance Index. This investment creates favorable conditions for automation in Vietnam to flourish.
Growth of Automation Around the World
To understand automation in Vietnam, we first need to look at what is happening around the world.
A research firm in New York says the global industrial automation market will grow by about 9.3 percent each year. It is expected to reach around GBP 227.6 billion, or US 287.6 billion, by 2030. In 2023, the market was about GBP 122.2 billion, or US 154.4 billion.
North America is the biggest market, making up about 35 percent. Asia-Pacific and Europe follow behind.
Manufacturing is the main driver of this growth. It makes up about 30 percent of the automation market. Oil and gas account for 20 percent, and power generation makes up 15 percent.
Vietnam is also part of this trend. As the country grows as a manufacturing hub, the demand for automation is increasing. Companies are looking for engineers who understand systems like PLCs, industrial robots, DCS, and SCADA.
This shows a clear change. Vietnam is not only competing on low cost anymore. It is moving toward better technology and higher efficiency, where automation plays an important role.
Automation in Vietnam is Growing
The automation in Vietnam market is large and growing fast. Here are the key figures as of 2026:
Industrial Automation Market
- The Vietnam Industrial Automation Market was valued at USD 2.52 billion in 2024 and is expected to reach USD 4.21 billion by 2030, growing at a CAGR of 8.78%.
- Hardware currently dominates the market, with strong demand for sensors, motion control systems, robotics, and industrial networking equipment.
- Software solutions like Manufacturing Execution Systems (MES), SCADA, and Distributed Control Systems (DCS) are gaining traction alongside services such as integration, maintenance, and post-sales support.
Industrial Robotics Market
- The Vietnam industrial robotics market reached approximately USD 104.3 million in 2025.
- The market is projected to grow to USD 168.3 million by 2034, at a CAGR of 5.45%.
- Market observers expect it could expand even faster, potentially reaching US$1.5 billion by 2030.
Robot Density
- According to the International Federation of Robotics (IFR) World Robotics 2025 Report, Asia’s average robot density stood at 131 units per 10,000 manufacturing employees in 2024.
- Western Europe led with 267 units, followed by North America at 204 units. Vietnam’s robot density is steadily increasing as major global manufacturers bring advanced automation into their local operations.
Smart Factory Market
- The Vietnam smart factory market size reached USD 926.3 million in 2025.
- It is expected to reach USD 2,146.1 million by 2034, at a CAGR of 9.49%.
Vietnam’s smart industry market, including AI, IoT, and industrial robotics, hit approximately US$2 billion in 2023, growing at 15-20% annually.
Government Policies and Incentives Driving Automation in Vietnam
The Vietnamese government is aggressively promoting automation in Vietnam through multiple policy initiatives, especially targeting strategic technology sectors.
Law No. 90/2025 on Investment Incentives
On June 25, 2025, Vietnam adopted Law No. 90/2025/QH15, amending the Law on Investment. This amendment introduced several game‑changing provisions:
- An accelerated investment procedure allowing foreign investors in strategic technology sectors to establish legal entities before completing investment registration formalities.
- Broadened eligibility for special investment incentives, with reduced investment thresholds for strategic technology and digital infrastructure.
Eligible projects must invest at least VND 3 trillion (around US 118 million) in digital infrastructure, such as big data, cloud computing, and 5G.
For strategic digital technology projects, including semiconductor manufacturing, AI data centers, and other priority sectors, the required investment is at least VND 6 trillion (around US 236 million).
MoIT’s Smart Production Programme
In early October 2025, the Ministry of Industry and Trade (MoIT) issued a major programme to promote smart production and digital transformation in industry and trade through 2035. Its goals include:
- By 2030: Develop and implement a readiness assessment index for digital transformation and a smart factory technology architecture framework.
- Gradually apply technical standards for digital transformation aligned with international frameworks.
- Drive dual transformation linking digitalization with green transition, optimizing both production and resource/energy usage.
Vietnam’s National AI Ambitions
Vietnam aims to become a regional leader in AI by 2030, ranking among the top three in Southeast Asia. The country already has the second-largest AI startup ecosystem in ASEAN (behind Singapore), accounting for 27% of the bloc’s GenAI startup market share in 2024.
Focus on High‑Tech FDI
Vietnam is also shifting its FDI attraction strategy from labor‑intensive industries to high‑technology sectors. Over US$38 billion in FDI was registered in 2025. The electronics and high‑tech sectors alone accounted for more than 65% of new investment inflows. Industrial production expanded by 10.3% in Q2 2025, supported by new manufacturing setups, driving demand for automation in Vietnam even higher.
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Bright Future for the Industrial Automation Industry in Vietnam
Different industries in Vietnam are reaping the benefits of artificial intelligence automation technologies, which have enhanced the quality and productivity of companies in these sectors. Let’s take a look at the impact of automation in Vietnam in the following industries.
Automotive Industry
Vietnam’s automotive industry has embraced automation in Vietnam at an impressive scale.
VinFast’s Smart Factory
VinFast’s Hai Phong automotive manufacturing complex has become a showcase for automation in Vietnam. Key highlights:
- Over 1,200 ABB robots operating across the facility, with an automation level of up to 90% in the press shop and 95% in the paint shop.
- A workforce of over 18,000 employees working in flexible three-shift rotations.
- Daily production record: 1,062 vehicles per day (December 14, 2025), equivalent to nearly 43 vehicles per hour — a productivity level comparable to the world’s largest Gigafactories.
- The plant produced 200,000 electric vehicles in 2025 alone.
VinMotion Humanoid Robots
VinMotion, a Vingroup subsidiary established in January 2025 with nearly US$40 million in registered capital, debuted humanoid robots designed to support tasks like parts transportation and quality control in VinFast EV factories, signaling Vietnam’s growing interest in next‑generation robotics.
Electronics Manufacturing Industry
The labor‑intensive electronics industry is a major driver of automation in Vietnam.
Samsung’s Smart Factory Initiative
Samsung launched a Smart Factory Development Cooperation Project on May 19, 2025, supporting 10 Vietnamese enterprises across the north and south. Results were impressive:
- An Lap Plastic Company (Bac Ninh): Raised production plan completion from 80% to 92%; reduced defects from 12% down to 0.5%.
- Vina Technology (Thai Nguyen): Cut foreign‑object defect rates by 68.7%; reduced material search time from 60 seconds to just 10 seconds.
- KCT Company (Ninh Binh): Reduced work‑in‑process defects by 30%; shortened delivery time from 5 days to 4 days.
- Overall, participants achieved equipment efficiency of up to 95% and quality defect reductions of up to 75%.
Samsung Electro‑Mechanics Expansion (April 2026)
In April 2026, Samsung expansion Project No. 2 was granted an Investment Registration Certificate to manufacture premium electronic circuit boards for robots, self‑driving vehicles, and other advanced high‑tech electronic devices.
Amkor Technology’s Semiconductor Plant
Amkor Technology has invested US$1.6 billion in its semiconductor facility — the largest in Vietnam — producing chips for aerospace, telecommunications, IoT, automotive manufacturing, medical devices, and automation equipment that will itself be used to build more advanced electronics.
Textile and Garment Industry
Vietnam’s textile sector — the world’s third‑largest — is rapidly modernizing its processes with automation in Vietnam.
When IDC Director Chu Viet Cuong spoke at the November 2025 international workshop on AI and digital transformation in textiles, he stated plainly: “Automation is becoming an inevitable trend in the global garment industry.”
Technologies being deployed include:
- Sewing robots
- Automated cutting systems
- AI‑powered line balancing
- Smart production lines
Healthcare & Logistics
Other than manufacturing and automotive, two other industries that are witnessing a surge in automation in Vietnam are healthcare and logistics. While AI-driven diagnostic systems and robots for operations are helping the healthcare sector to deliver personalized treatments in record time, AI systems and robots are improving warehousing, stockpiling, and last-mile deliveries in the logistics industry
The impact of automation is also felt in industries like Textile and Food and Beverages. While the F&B sector has seen an increase in the production of diaries by creating smart warehousing and factories with the help of automated robots and automation of production lines, the garments sector saw companies reducing fuel consumption by using 4.0 technology and automation to make innovative products.
Potential Impact & Preparedness in APAC
One critical reason why automation in Vietnam is booming is the 4.0 industry preparedness in the Asia Pacific (APAC) region as seen in the predominance of industrial robots (64%) in this part of the world. The APAC region also boasts of a high indulgence in AI platforms which is growing at a double in speed in 2019-2024 than in other countries.
Additionally, internet adoption is significantly better in Vietnam than in other APAC countries, which generally lack basic features like KYC process availability in major banks (2 out of 5 usually have it) and individual internet skills of people. Businesses in the Asia Pacific region complain of these issues more than automation, but Vietnam is advanced in this department.
A Deloitte analysis has shed light on how labor markets are reaping the benefit of automation as it helped in eradicating drawbacks like stagnant growth, an ageing population that can’t do manual labor, and a shortage of workforce. So, based on the changing dynamics of work across industries, automation is the key to addressing bottlenecks, and Vietnam is prepared to take advantage of its initial growth in the industrial automation industry.
Worldwide, the COVID-19 pandemic has set the stage for increased automation adoption, which is visible from the fact that nearly 50% of companies are looking to adopt robotic automation in 2025.
Read More: Vietnam’s Economic Growth Projections: Surpassing Southeast Asian Nations by 2036
Implications for the Vietnamese Workforce
Automation in Vietnam is a disruptive force for ageing traditional workers who don’t possess the skills required in the industrial automation industry. Many workers in the garment, food and beverage, and other sectors who used to do menial jobs are facing unemployment. These people lack the fine balance of computer skills, language skills and systematic thinking skills required for jobs now.
While there is a shortage of skilled workers in the F&B and garment industries in Vietnam, training people for employability is a cumbersome process that requires time. Businesses prefer to automate operations instead of reducing production costs.
Read Related: Vietnam’s Workforce: High-Demand Skills and Advice for Business in 2024
Automation in Vietnam: Challenges for the Workforce
Job Displacement Fears Are High
According to a UNDP Asia‑Pacific regional human development report released in December 2025, 61% of Vietnamese people fear losing their jobs or being unable to find work due to AI. This is among the highest levels in the region.
AI is already replacing basic entry‑level roles commonly used by young workers, such as administrative work, scheduling, translation, and research. This is depriving young people of crucial early‑career opportunities.
Skills Mismatch
The shortage of skilled labor is a shared challenge across all manufacturing sectors. Many traditional workers in garments, food and beverage, and other sectors lack the computer literacy, language skills, and systematic thinking required for modern automated jobs.
Companies face a choice: invest heavily in upskilling or automate faster to reduce production costs. Most choose the latter — at least in the short term.
Growth Opportunities for Automation in Vietnam
Despite the challenges, Vietnam’s automation is likely to grow in the coming years and the government announced several plans to support that. At present, 20 out of 99 high-tech products prioritized by the Ministry of Science and Technology are from the automation field. The ministry is also helping in the development of 107 high-tech products, which include 30 automation products.
More and more vendors from the industrial automation industry are made part of the Main Automation Contractor (MAC) concept which is crucial for the procurement of components of automation and control systems. These vendors are urged to handle and manage the system throughout the whole lifecycle of the project as it would help them in upskilling.
As the industrial production sector across industries like automobiles, machinery, and electronics take up automation to boost their production, the automation market in Vietnam will also grow, ultimately leading to positive economic growth. Hence, automation in Vietnam is expected to find a wider acceptance in industries like chemicals and power generation.
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Frequently Asked Questions
How big is the industrial automation market in Vietnam?
- As of recent estimates, the industrial automation market in Vietnam is valued at approximately USD 2.5 to 3 billion and is growing at a compound annual growth rate (CAGR) of around 10–12%. Growth is driven by strong manufacturing expansion, government support for Industry 4.0, and increasing foreign direct investment in electronics and automotive sectors.
What is Vietnam's stance on AI and automation?
- Vietnam actively supports the development and adoption of AI and automation as part of its national strategy on the Fourth Industrial Revolution. The government has released a National Strategy on AI Development to 2030, aiming to make Vietnam a top 4 AI hub in ASEAN. Authorities encourage foreign and local investment in AI-related sectors, while also addressing potential workforce impacts through education and upskilling initiatives.
