Key Points
- Vietnam’s government is aggressively pushing for a rapid switch to electric motorbikes.
- Gas-powered motorbikes will be banned from the center of Hanoi in just 12 months.
- Honda’s sales in Vietnam plummeted in August following the announcement of the new policy. Urban residents now plan to buy an EV for their next bike.
- The government’s push poses a significant threat to Honda’s 80% market share and presents a substantial boost for local EV maker VinFast.
Honda’s long-standing dominance in Vietnam’s massive motorbike market is facing a serious threat from the government’s aggressive new push for electric vehicles. The move is a major boost for local EV maker VinFast and has sent shockwaves through the industry.
In July, Vietnam’s Prime Minister issued a directive that will ban gas-powered motorbikes from the center of the capital, Hanoi, within 12 months. The ban will be expanded in 2028. This rapid shift has caught traditional manufacturers, such as Honda, off guard, and they have reportedly written to the government to complain that the changes are happening too quickly.
The impact is already being felt. Honda’s sales in Vietnam plummeted nearly 22% in August, immediately following the announcement of the new policy. A recent consumer survey indicates that the government’s push is effective. A majority of residents in Vietnam’s two largest cities now say they plan to buy an electric motorbike for their next purchase, with many citing the new government policies as their main reason.
This represents a significant potential shift in a market where Honda currently holds an 80% market share. While most people in the survey still said they would consider buying a Honda, a significant 32% said they would now opt for a VinFast model.
“The rapid policy support… has significantly shaped consumer attitudes and could accelerate a market shift faster than traditional manufacturers anticipated,” said one market researcher.
