As electric bikes become more familiar to Vietnamese consumers, domestic companies have braced themselves to regain market share in the home market.
According to a survey released by the organisers of International Expo on Two-wheeled Vehicles 2013, electric bicycles made by Japan, China and Taiwan currently account for 80 percent of the market share in Vietnam, with various designs and colours while the two-wheelers made domestic companies, branded Thong Nhat, Delta, Hitasa and Martin 107 made up 8 percent of market share.
The underdog on home market
Presently, an electric bike consists of a power engine and a dynamic function aimed for physical practice. However, the price of an electric bike made Japanese, French, American or German companies is unaffordable for most Vietnamese consumers. For example, a Taiwanese electric bike is priced US$700; Singapore, US$700; France, US$900; Germany, US$900; the US, US$1,200; and Japan, US$1,300. This is the main factor for Vietnamese electric bikes to confidently compete with foreign rivals.
In fact, “Made in Vietnam” electric bikes faced fierce competition of Chinese rivals from their birth. Chinese electric bikes are actually variations of conventional bikes which are redesigned, installed with engines, headlights and turning signals like motorcycles. Battery – the most important component of the bike – is placed beneath the saddle, which is convenient for power recharge and de-installation. And, most importantly, the prices are affordable for most consumers. And, this is the reason for the strong competitive pressure of Chinese bikes in Vietnam. Indeed, Vietnamese bike manufacturers are struggling for survival. Several years ago, Thong Nhat which was known as the biggest manufacturer in Vietnam now can sell only 200 bikes a day in Hanoi, forcing it to reduce the number of outlets in the second biggest city in Vietnam to only two.
Like Thong Nhat, Delta Company has to scale down output to 150 – 200 bikes a month from 300 – 400 units earlier, said Mr Vu Tien Hao, an official of Delta Company.
Imported electric bikes are now accounting for nearly 80 percent of the market share, mainly from China and Japan, with popular brands being Asama, Giant, Sukaki, Honda and Yamaha. Although their quality is not too far from that of Vietnamese products, foreign electric bikes easily beat Vietnamese competitors. Without a doubt, if Vietnamese companies lack good development plans, they will quickly lose the rest of their market share.
Persistently looking for opportunities
In spite of keeping just 10 percent of market share, many Vietnamese electric bike manufacturers said they never feel discouraged. An official of Thong Nhat Company said his company is improving its models to better serve customers, buying the best electric motors for its bikes and chargers made to Siemens standards. The company is now focusing on products for the elderly and students. The company will continuously work out the best designs for specific groups of investors at the most competitive prices, he added.
Quite a long time ago, after the European Commission Directorate General for Trade imposed anti-dumping duty on Vietnamese bikes, Vietnamese bike manufacturers shifted their focus on the domestic market with electric bike models. Thong Nhat Company invested US$2 million to purchase equipment and technologies from Europe, Japan and Taiwan, including plastic compression systems, electrostatic coating lines and robotic welders. Currently, Thong Nhat is capable of manufacturing and assembling more than 100 sizes of rims or wheels and manufacturing a variety of products for both popular and high-grade segments. The company introduced its products to domestic consumers at the International Expo on Two-wheeled Vehicles 2013, said Nguyen Huu Son, Director of Thong Nhat Company.
Delta Company is not only striving to expand the domestic market but also boosting global sales. Its products are now available in Switzerland, Canada, the United States and other nations. The company is offering its products to some French companies.
However, the heavy reliance on imported components has significantly driven up product costs. Currently, the import duty on motors is 30 percent, the tariff on batteries and many other parts is 60 percent. All domestic electric bike producers expect more suitable taxation policies to help them boost domestic sales.
Nguyen Thanh
Đăng ký: VietNam News