The dream of Vietnam’s pioneer carmaker Xuan Kien Auto (Vinaxuki) to revive its former glory has been crushed by the Ministry of Finance after it turned down the company’s request for bank loans.

Vinaxuki, founded by aspiring engineer Bui Ngoc Huyen, was seeking a loan to rebuy bad debts that had been sold to the state-owned Vietnam Asset Management Company (VAMC).

Huyen’s auto business saw its heyday between 2009 and 2011, when Vinaxuki trucks were a common sight across the country.

However, an ambitious investment into developing affordable cars for local consumers left the entrepreneur neck-deep in debt after the project was shelved indefinitely.

If it the project had continued, it would have involved three factories in Hanoi and the northern provinces of Thai Nguyen, and Thanh Hoa, bringing with it as many as 9,000 jobs for local engineers and laborers.

The factories were designed to produce up to 30,000 cars each year at costs allowing them to be sold on the Vietnamese market for just VND100 million (US$4,400).

In September, Vinaxuki aired its intention to restart the project by requesting government permission to take out more loans in order to rebuy bad debt accrued from previous loans which had already been sold to VAMC for liquidation.

The Ministry of Finance recently issued a letter refusing the company’s request, citing a lack of legal grounds for such an unprecedented procedure.

Late last year, Huyen submitted a 20-page petition to the government, seeking to have his debts extended in a bid to buy time to restructure the business.

Though the petition was accepted for consideration, the finance ministry’s latest decision could deal a blow to Huyen’s dream of putting Vinaxuki back on the road.

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