Market overview

According to the Vietnam Association of Motorcycle Manufacturers (VAMM), the five member companies—Honda Vietnam, Yamaha Vietnam, SYM Vietnam, Vietnam Suzuki, and Piaggio Vietnam—sold a combined 1.22 million motorcycles in the first half of 2024. These five companies, all foreign-invested enterprises, account for over 90% of the market share.

In addition to VAMM members, several other companies, including VinFast, DatBike, Pega, Yadea, and Detech, participate in the production of electric motorcycles. The total motorcycle consumption in Vietnam for the first half of 2024 is estimated to be around 1.4 million units.

However, data from the General Statistics Office indicates that 1,455,000 new motorcycles were produced in the first half of 2024, a 1.3% decrease compared to the same period in 2023. Coupled with over 300,000 units carried over from 2023 (where production reached 3,145,200 units and sales were about 2.8 million units), the total supply now far exceeds demand.

VAMM data shows that sales for the five member companies were 603,745 units in Q1 of 2024 and 603,127 units in Q2 of 2024, indicating stagnant growth.

Honda Vietnam, which holds about 80% of the market share, sold 475,630 units in Q2, a 6.9% decrease from Q1 and a 1.8% drop compared to the same period last year. Cumulatively, Honda Vietnam sold 957,885 motorcycles in the first half of 2024, a 4.6% decrease year-on-year.

Economic difficulties have led to tighter consumer spending, weakening demand. The motorcycle market is also becoming saturated, with traditional models offering few new features, particularly for younger customers. Additionally, the convenience and competitive pricing of ride-hailing services have altered transportation preferences.

Price reductions and consumer behavior

A survey in Hanoi in early July 2024 revealed significant price reductions for many popular Honda models. For example, Honda Lead models are being sold for 39 to 42 million VND/unit, 550,000 to 750,000 VND below the suggested retail price. Previously, these models often sold for 3 to 5 million VND above the suggested price.

Honda SH 350i is priced at 120 million VND, about 30 million VND below the suggested retail price. Honda SH 125i models range from 72 to 82.5 million VND, 1 to 2 million VND below the suggested price, whereas they previously sold for 7 to 10 million VND above the suggested price.

The Honda Winner X, with a suggested retail price of 46.16 million VND, 50.06 million VND, and 50.56 million VND for its three versions, is selling for 7.56 million VND to 10.06 million VND less than these prices at dealerships. Customers purchasing models like Honda Future 125, Honda Wave 110, and Honda Vario 160 are receiving gifts worth millions of VND - an unprecedented trend.

Impact of environmental regulations

The newly passed Road Traffic Safety and Order Law, effective January 1, 2025, mandates emissions testing for motorcycles. This regulation influences consumers' decisions, with many opting for electric motorcycles to avoid emissions testing and save on fuel costs, thus contributing to environmental protection.

Consequently, the demand for gasoline motorcycles is expected to decrease, and their prices are unlikely to rise significantly as before.

Data from the Ministry of Transport shows approximately 73 million registered motorcycles in Vietnam, with about 70 million being gasoline-powered. Annual new gasoline motorcycle sales are around 2.5 million units. The widespread use of gasoline motorcycles significantly contributes to environmental pollution. For instance, a motorcycle considered fuel-efficient still consumes about 1.6 liters per 100 km, emitting over 2 kg of CO2 per liter of gasoline burned. With tens of millions of motorcycles in daily use, the environmental impact is substantial.

Motorcycles are expected to remain the primary mode of transportation in Vietnam for years to come. With an average consumption of nearly 2.5 million gasoline motorcycles per year, controlling emissions is essential to reducing pollution and improving quality of life.

Some experts suggest that in addition to emissions control, other measures such as increasing taxes and fees to limit gasoline motorcycle use and encouraging the transition to electric motorcycles and public transportation should be considered.

PV