Japan has warned Vietnam that Hanoi’s plan to ban petrol-powered motorbikes could cost thousands of jobs and shake a $4.6 billion industry built around two wheels. The move, set for mid-2026, aims to fight air pollution but could leave many workers and small businesses stranded.
Japan’s embassy in Hanoi said a sudden ban “may hurt employment in supporting industries” such as parts suppliers and dealers. It urged Vietnam to adopt a slower, more practical path toward electric mobility.
Vietnam has one of the world’s highest motorbike ownership rates, nearly 80 million bikes for 100 million people, according to Mordor Intelligence. The market is dominated by Honda, which sold 2.6 million bikes last year, controlling about 80% of the sector. The Japanese manufacturer employs thousands across four factories and supports nearly 2,000 dealers and 200 suppliers nationwide.
But Honda’s sales fell sharply, down 22% in August 2025, after Hanoi announced the ban. “We are closely monitoring the situation,” Honda said in a statement. “We have no plans to close factories but remain concerned about the impact on workers.”
The Vietnam Association of Motorcycle Manufacturers, led by Honda, Yamaha, and Suzuki, warned the ban could trigger “production interruptions and even bankruptcies.” The group asked for a 2–3 year transition period to set up charging stations and update safety standards.
Officials in Hanoi say the plan is vital to cut pollution. The city’s air quality index often ranks among Southeast Asia’s worst. Prime Minister Pham Minh Chinh said in August that climate action “requires joint efforts to choose the most optimal solution with a suitable roadmap.”
The shift could, however, create new winners. Sales of VinFast’s electric bikes jumped 55% in the second quarter of 2025 to nearly 70,000 units. The Nasdaq-listed firm is now poised to dominate Vietnam’s new e-bike era. Meanwhile, petrol car sales dropped 18% in September, showing how the green transition is already changing consumer behaviour.
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