Honda’s dominant position in Vietnam’s motorbike market is coming under pressure as the government accelerates a transition to electric vehicles, a move that is expected to benefit domestic manufacturer VinFast, according to industry data and consumer surveys.
Vietnam’s Prime Minister Pham Minh Chinh in July issued a directive banning fossil-fuel-powered motorbikes from central Hanoi within 12 months, with the restrictions set to expand citywide by 2028. The measure is part of efforts to curb severe air pollution in the capital, which frequently ranks among the world’s most polluted cities.
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Industry data showed Honda’s sales in Vietnam fell nearly 22% in August from July — a 13% year-on-year drop — following the announcement of the new policy. Honda and other foreign motorbike producers have reportedly written to Vietnamese authorities expressing concerns that the transition is being implemented too quickly, according to two people familiar with the matter. Representatives for Honda in Vietnam did not respond to requests for comment.
The policy shift has already influenced consumer sentiment. A September survey by market research firm Asia Plus Inc. found that 54% of respondents in Hanoi and Ho Chi Minh City intend to buy an electric motorbike for their next purchase, while only 24% prefer a gasoline model. In Hanoi, the figure for electric preference was even higher at 60%.
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“The rapid policy support, including phased bans, incentives, and public messaging, has significantly shaped consumer attitudes and could accelerate a market shift faster than traditional manufacturers anticipated,” said Kengo Kurokawa, head of Asia Plus.
Vietnam’s two-wheeler market, valued at $4.6 billion in 2025, is projected to reach $6 billion by 2030, according to Mordor Intelligence. Petrol motorbikes currently dominate the market, with Honda selling about 2.6 million vehicles in Vietnam last year — more than 80% of the total. By contrast, VinFast delivered around 71,000 electric motorbikes.
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While Honda, the world’s largest motorbike manufacturer, is developing electric models, it has not disclosed its EV sales figures in Vietnam. The survey found that 50% of respondents would still consider buying a Honda model, compared with 32% for VinFast, though over 80% already own a Honda motorbike and only 4% currently have a VinFast.
As the government pushes ahead with its environmental agenda, analysts say the combination of policy mandates and shifting consumer preferences could erode Honda’s long-standing market share and accelerate Vietnam’s transition toward electric mobility.
Source: Reuters
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