Motorbike makers race to meet demand

Honda Viet Nam Company Ltd has recently decided to expand its production capacity to an additional 500,000 motorbikes per year to fully tap the Vietnamese market.

Last year, the company provided more than 1.43 million vehicles while its current production capacity is 1.5 million per year.

HVN general director Koji Onishi said such a capacity would not be able to ensure supplies of vehicles for the market in coming years.

In 2009, the company achieved a sales growth rate of 18 per cent compared with 2008. This year, it is expected to grow with more than 1.5 million motorbikes to be sold.

Koji Onishi said the use of Honda motorbikes in Viet Nam was growing. Viet Nam is the fourth largest strategic market of Honda motorcycles in the world, after China, India and Indonesia.

Viet Nam is a lucrative market for motorbike makers, particularly foreign companies. In the last five years, between 2.5 and 3 million vehicles were sold each year. In 2009 alone, motorbike makers sold more than 2.7 million vehicles, of which 2.3 million were from foreign-invested companies.

The motorbike demand is estimated to increase since income and living conditions are improving.

Manufacturers of luxury motorbikes are also optimistic about sales. The Indochina Automotive – IC Auto recently introduced new expensive models, like the Ducati, each with prices ranging from US$24,000 to $60,000.

The Vietnamese motorbike market has large potential. Although the market share for expensive vehicles is still small, it shows signs of expanding rapidly in the future, according to IC auto director Lawson Dixon.