Motorbike Industry Remaining Many Opportunities to Develop

 

According to statistics, Vietnam currently has about 52 motorbike assembling plants, of which there are 22 State-run enterprises, 23 non-state businesses and 7 FDI companies. There are four motorbike assembling technologies coming from Japan (Honda, Yamaha, Suzuki), Taiwan (SYM), South Korea (Daelim, DaeHan) and China (Loncin, Lifan, Sufat) of which Chinese technologies account for the largest portion of low-price motorbike.

The most memorable landmark is the moment when Chinese motorbikes rushed into Vietnam and enterprises operating in this field eagerly applied for licence to produce and assemble. With the flow of cheap motorbikes, people have chance to own an individual means of transport satisfying their demand for travel as well as combating motorbike trafficking from Cambodian border.

According to the recent assessment by the Ministry of Industry, among domestic assembling companies, there are currently only 11 ones with rather high competitiveness, 24 with weak competitiveness and 10 on the verge of dissolvement. To survive in a fierce competition environment, several enterprises have found their own ways. Hoa Lam is a motorbike manufacturer with technology of Daelim, South Korea. Two brands appearing on the market are Daelim and Halim. This series of motorbike was not advertised noisily, however, Hoa Lam still maintains its position on the market.

Another is VMC who also offers many levels of price and diversified designs in order to survive in the popular motorbike market. The company has recently launched sport-styled, sinewy motorbikes with price of only around 9 and 10 million dong. Such cheap products meet demand of popular consumers and those from rural areas.

Foreign companies including big corporations such as Honda, SWM, Suzuki and Yamaha, etc now pay attention to medium-class motorbikes with youthful, fashioned style for young customers whose income is rather high.

 

Beside competition in domestic market, some motorcycle assembling enterprises have taken further step to enter foreign markets. According to the Institute for Industry Policy and Strategy - Ministry of Industry, the motorcycle export market is opening door for Vietnamese enterprises. From now to 2020 China, Laos, Cambodia, Africa etc. are potential markets of the motorcycle with the cylinder capacity below 175cc and low price. In 2005, about 100,000 motorcycles and components exported brought about US$50 million. Of which, Honda Vietnam has exported 73,000 motorcycles and 17,000 engines of motorcycle to neighbouring countries. Mr. Hiroaki Funami - Director of Honda Vietnam said that Honda has exported 163,000 motorcycles of all kinds and earned over USD92 million since June 2002. In 2006, number of Honda's motorcycles and components will higher increase because designs and quality of Honda motorcycles have admired regional customers.

 

Many 100 per cent foreign capital enterprises like T&T Company, Hoa Lam Company, Duc Phuong Limited Liability Company, Lisohaka have found markets to export motorcycles to East-Timo, Angola, Dominique, South Africa, etc. Hoa Lam Company has invested in a motorcycle-assembling factory in Senegal through technology transfer since 2002, which can produce 100,000 motorcycles per year for the markets of this country and its neighbours.

 

Export markets exist large potentials thanks to the strong economic development in third world countries - Vietnam's trading partners, especially ones in Asia and Africa. It is estimated that by 2010, the number of motorcycle exported can reach 500,000 motorcycles per year. This is the big chance for Vietnam's motorcycle industry.