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|With half the population in possession of a unit, the Vietnamese motorcycle market has reached a point of saturation, Photo: Le Toan|
The total number of motorcycles sold in this year’s first quarter – from the likes of Honda Vietnam, Piaggio Vietnam, Suzuki Vietnam, SYM Vietnam, and Yamaha Motor Vietnam – is 803,204 units, a mere 1.9 per cent increase on-year according to the Vietnam Association of Motorcycle anufacturers (VAMM).
Each month the five firms sold nearly 270,000 motorbikes on average, which means that approximately 9,000 motorbikes were sold each day nationwide.
There are no details on the individual company sales, but in recent years, Honda Vietnam has been dominating the sector with a market share of about 69 per cent in 2017 according to Honda Vietnam, with Yamaha Vietnam following behind.
A fortnight ago, Yamaha Motor announced consolidated business results for the first quarter, saying that “Unit sales in developed markets decreased due to factors such as a decline in total demand and irregular weather in Europe. Unit sales in emerging markets such as Indonesia, the Philippines, and Brazil increased, but decreased in the Vietnamese market.”
According to the Ministry of Industry and Trade (MoIT), as more people in Vietnam tend to choose other travel methods than motorbikes, the market has suffered low growth in recent years.
Vietnam is the fourth-largest motorcycle market in the world, after China, India, and Indonesia. According to the MoIT’s latest data, the number of motorbikes in Vietnam has already surpassed 45 million, 25 per cent above the government’s plan. It is an astounding figure that one in every two people owns a motorcycle.
VAMM has forecast that the market is entering a saturation period. Currently, automatic motorbikes account for 45 per cent of the market share.
Tuan Anh, a salesman at the Yamaha store on Kieu Mai street in Hanoi, said his store receives 40 per cent fewer customers than four years ago.
“In the past we would earn several million dong in profit for each Yamaha we sold, but now we are only taking several hundred thousand dong. If we include the cost of rent and employee salaries, we are lost,” said Anh, adding that some Yamaha stores had closed due to sustained losses.
Vietnam’s motorbike market is in trouble and will continue to slow down in the near future as the supply has already surpassed demand, a representative of Honda Vietnam told VIR.
The competition for a share in the saturated Vietnamese motorcycle market is going to heat up in the next few years, with companies targeting the few remaining niche markets and raising the quality of their after-sale services, according to VAMM.