Vietnam Scooter Market Outlook to 2030

Vietnam Scooter Market Overview

• The Vietnam Scooter Market is valued at USD 170 million, based on a five-year historical analysis. This growth is primarily driven by the increasing urbanization, a rising middle-class population with disposable income, and a growing preference for fuel-efficient and affordable transportation options. The rapid expansion of e-scooter adoption is further supported by government policies promoting electric mobility, such as tax incentives and reduced registration fees for electric vehicles. Additionally, scooters have become the preferred mode of transportation in urban areas due to traffic congestion and the need for compact vehicles.

• Dominant cities in the Vietnam scooter market include Hanoi and Ho Chi Minh City. These cities lead the market due to their high population density, leading to greater demand for two-wheelers as an efficient and cost-effective mode of transport. The dominance of these cities is also fueled by the high rate of urbanization, with more citizens moving into metropolitan areas, creating a surge in demand for affordable personal transportation options like scooters.
• The Law on Road Traffic Order and Safety 2024 was passed on June 27, 2024, and will take effect on January 1, 2025. This law includes various measures aimed at improving road safety, but specific details about mandatory ABS for scooters and enhanced lighting systems were not confirmed in the provided sources.

Vietnam Scooter Market Segmentation

By Product Type: The Vietnam Scooter Market is segmented by product type into electric scooters, gasoline scooters, and hybrid scooters. Among these, electric scooters have gained a dominant market share due to increasing environmental concerns and government policies that promote sustainable transportation. Electric scooters have become popular for their low operating costs and eco-friendly nature, making them an attractive option for both young professionals and students in urban areas. Brands like VinFast have spearheaded the electric scooter market in Vietnam, benefiting from government-backed incentives and an expanding charging infrastructure.

By Power Output: The scooter market is further segmented by power output into below 50cc, 50cc 125cc, and above 125cc categories. The 50cc 125cc segment dominates the market, mainly because it offers a balance between affordability, fuel efficiency, and sufficient power for daily commuting. This range is favored by working professionals and students alike, especially in urban settings where maneuverability and fuel economy are essential. The widespread availability of mid-range scooters at competitive prices from local and international brands has further solidified the dominance of this segment.

Vietnam Scooter Market Competitive Landscape

The Vietnam Scooter Market is dominated by key local and international players. These companies have a significant influence on the market due to their extensive distribution networks, strong brand recognition, and commitment to innovation, particularly in electric scooters. The competitive landscape is characterized by collaborations between local manufacturers and global brands, which enables faster technology transfer and the introduction of new models tailored to local preferences.

Vietnam Scooter Industry Analysis

Growth Drivers

• Urbanization and Rising Disposable Income: Urbanization in Vietnam is increasing rapidly, with the 39.8 percent of Vietnams population lived in urban centres. This shift is fueling demand for scooters, particularly in urban areas where commuting is crucial. Additionally, the middle class is expanding, with projections indicating that 60% of households will earn over $5,000 annually by 2027, further driving the affordability and purchase of scooters. As more individuals move to cities, the need for personal transportation grows, making scooters a preferred option due to their affordability and convenience.
• Fuel Efficiency and Environmental Benefits: Scooters, especially electric ones, are recognized for their energy efficiency and environmental benefits. Vietnam's transition to electric scooters, such as the Ather 450X, which can provide a True Range of up to 115 km on a single charge, offers significant fuel cost savings compared to gasoline-powered models, which typically achieve only around 40 km/l over five years. Beyond economic advantages, electric scooters also reduce carbon emissions, supporting the country's broader climate strategy that emphasizes lowering fossil fuel dependence and mitigating the impacts of climate change.
• Expansion of E-scooters: The adoption of electric scooters in Vietnam is steadily increasing, driven by government initiatives aimed at promoting electric mobility. These initiatives are fostering a shift toward environmentally friendly transportation options. Electric scooters, offering both cost-effectiveness and fuel efficiency, are becoming a popular alternative to traditional vehicles. As awareness of environmental sustainability grows among consumers, the demand for electric scooters is rising, positioning them as a viable solution for eco-conscious individuals. The government's push for electric vehicle adoption is further encouraging the transition to cleaner, more sustainable transportation modes.

Market Restraints

• Traffic Congestion in Urban Areas: Vietnam's urban centers, particularly cities like Ho Chi Minh and Hanoi, are experiencing increasing traffic congestion. While scooters are more maneuverable than cars, heavy traffic significantly impacts their efficiency as a transportation mode. The growing number of vehicles on the road is making commuting more time-consuming, even for two-wheelers like scooters. To ease this issue, infrastructure development, such as road expansions and the creation of dedicated scooter lanes, is necessary to improve the flow of traffic and support wider adoption of scooters as an efficient mode of transport.
• High Competition from Motorcycles: Motorcycles dominate the two-wheeler market in Vietnam, creating tough competition for scooters. Although scooters, especially electric models, are gaining popularity, traditional motorcycles remain the primary choice for many consumers. This strong market presence makes it challenging for scooter manufacturers to gain a larger market share. To compete effectively, scooters must offer unique advantages, such as environmental benefits and cost savings, to attract buyers and stand out in a crowded market of well-established motorcycle brands.

Vietnam Scooter Market Future Outlook

Over the next five years, the Vietnam Scooter Market is expected to experience significant growth driven by continuous government support for electric vehicles, advancements in battery technology, and increasing consumer awareness of environmental sustainability. The growing middle-class population, along with increasing urbanization, will further drive demand for scooters, particularly in densely populated cities. The expansion of e-scooter infrastructure, including charging stations, will be a pivotal factor in accelerating the adoption of electric scooters in both urban and suburban areas.

Market Opportunities

• Growing Demand for Electric Vehicles: The demand for electric vehicles, including scooters, is increasing rapidly in Vietnam, driven by rising environmental consciousness and supportive government policies. This shift towards electric mobility provides significant growth opportunities for manufacturers as consumers look for eco-friendly alternatives to gasoline-powered scooters. The growing interest in reducing carbon footprints and the appeal of sustainable transportation options are helping to drive the adoption of electric scooters, positioning the market for continued expansion in the coming years.
• Technological Advancements in Battery Technology: Advancements in battery technology are playing a crucial role in enhancing the practicality of electric scooters. Improvements in battery efficiency are reducing charging times and extending the range, making electric scooters more suitable for daily commuting. These advancements also contribute to long-term cost savings, as they minimize the need for frequent battery replacements. As battery technology continues to evolve, it presents a key growth opportunity for the electric scooter market, making these vehicles more appealing to a broader consumer base.