Japan cautions Vietnam over job risks from Hanoi motorbike ban

Japan has raised concerns that Hanoi’s planned ban on petrol-powered motorbikes from mid-2026 could cause job losses and disrupt Vietnam’s US$4.6 billion two-wheeler market, according to documents reviewed by Reuters and people familiar with the matter.

The Japanese embassy in Hanoi sent a letter to Vietnamese authorities warning that the ban may affect employment in supporting industries such as dealers and parts suppliers, and urged a phased transition to electrification.

Vietnam’s two-wheeler market, one of the world’s largest, is dominated by Honda, which holds an 80% market share.

A trade group representing foreign motorcycle makers, including Honda, Yamaha, and Suzuki, also warned the government that the ban could lead to production interruptions and possible bankruptcies in the supply chain.

Despite requests for a multi-year transition period, Vietnamese officials have not responded to calls for delays.

Honda’s sales in Vietnam dropped nearly 22% in August after the ban was announced, while local EV maker VinFast reported a 55% rise in electric motorbike sales in Q2 2025.

🔗 Source: Reuters

🧠 Food for thought

Implications, context, and why it matters.

Hanoi 2026 motorbike ban boundaries set, enforcement and exemptions still unclear

Directive 20 is a July 2025 order barring petrol motorbikes in central Hanoi and starts in July 2026, tying the zone to Ring Road 1 (the innermost traffic loop demarcating the city center) 1. Officials have not outlined exemptions or controls at many entry points 1.
Plans call for signage at gateways, traffic police at intersections, plus fines of Vietnamese đồng (VND) 2–3 million, while camera scope and density remain undisclosed 2.
Financial support proposals face a September 2025 vote, about nine months before Phase 1 (the initial July 2026 central city restriction), and motorcycle makers led by Honda have asked for a 2–3 year transition 2 3.
Only 18% of surveyed residents believe the 2026 deadline is achievable, which signals weak confidence and a possible delay 4.

Battery swapping land grab while standards remain in flux

VinFast targets 150,000 swap stations within three years, yet coverage is thin 5. Honda runs 19 locations, and Selex Motors (a Vietnamese e-motorbike startup focused on logistics fleets) runs about 90 sites for delivery fleets, while battery swapping means a quick exchange of a depleted pack for a charged one 5.
Incentives for infrastructure investors include 70% interest support for five years, land rental subsidies until 2033, plus preferential 3–5% loans 2.
Real estate operators or energy companies can host swap stations at retail sites, with V-Green (VinFast’s charging-infrastructure arm) set to deploy cabinets at 625 FPT Shop stores (a nationwide electronics retailer) starting 2025 5.
Standards for station safety, interoperability, plus related requirements remain in development as authorities advance charging rules while finalizing the Low Emission Zone (LEZ) plan due by Q3 2025 2 6.