Honda warns Vietnam sales could drop 200,000 units on proposed gasoline motorbike ban

Honda Motor Co. has warned that its annual motorbike sales in Vietnam could fall by around 200,000 units if Hanoi moves ahead with a plan to ban gasoline-powered two-wheelers in downtown city.

The estimate was disclosed in the Japanese automaker’s financial report for the second quarter of its fiscal year ending March 2026.

Noriya Kaihara, Honda’s director and executive vice president, said sales of its internal combustion engine (ICE) motorbikes in Vietnam dropped 10-15% year-on-year in August and September.

The declines came after Prime Minister Pham Minh Chinh issued Directive 20 on July asking Hanoi to ban gasoline-powered motorbikes from its downtown core starting July 2026, part of a sweeping plan to cut emissions and improve air quality.

The ban may apply to all fossil fuel-powered motorbikes and scooters operating within Ring Road 1, which covers the central districts, including Hanoi’s Old Quarter.

However, given the current situation, it is unclear whether the regulations will be implemented, so sales in October almost recovered to the same level as a year earlier, said the executive, adding that the company will closely monitor future developments.

To prepare for tighter emissions rules, Honda has launched two electric two-wheelers, the ICON e: and CUV e:, but acknowledged that the lineup is still too limited to compete effectively.

The company is developing another EV model, with plans to manufacture it in Thailand before exporting it to Vietnam, while also assessing prospects for local production.

A 200,000-unit decline would be significant but not disruptive for Honda’s Vietnam operations. In 2024, the company sold 2,147,025 motorbikes in the market, up 2.8% year-on-year, excluding 28,023 units exported.

Between April and October 2025, Honda sold 1,216,219 units in Vietnam, a marginal increase of 0.2% from a year earlier.