Rocketing price of Honda motorbikes sends buyers into a spin

July, 09/2022 - 09:59
Local clients are bemoaning a sharp increase in retail price and lack of motorbike supplies in the Việt Nam market.

 

Vision - Honda’s best-selling model for years - displayed at a Hà Nội bike shop. Photo xe.baogiaothong.vn

HÀ NỘI — Local clients are bemoaning a sharp increase in retail price and lack of motorbike supplies in the Việt Nam market as they have to buy bikes at least 20 per cent higher than the listed prices Honda Vietnam.

Over the past two months, Honda Vietnam Company’s automatic gear bikes have rocketed uncontrollably after bike dealers raised retail prices of between 10-20 million đồng for its most popular scooters such as Vision, Air Blade or SH.

As Honda’s best-selling model for years, Vision model sales are always publicised monthly by the company. Late April this year, Honda Vietnam announced that the availability of domestically -manufactured scooter models may have been affected due to the affected supply chain. Vision is also a topic of much discussion in recent times as the retail price at dealers of this scooter is over VNĐ50 million, while the listed retail price was only as high as VNĐ35 million. Despite the rocketing price, the Vision is still in short supply.

Honda SH model is also one of those constantly having prices strongly raised by bike dealers, often by over VNĐ10 million to 15 million from the listed price.

The sales staff at some bike dealers said the current scooter demand was quite high, while it was often in short supply. There were not enough colours and versions for sale, and it was difficult for buyers to purchase one due to the wrong version or colour.

Hoàng Tùng, a bike shop owner, said clients rushed to his shop to buy bikes, but his shop stopped receiving deposits for Vision models from buyers from May this year.

A representative of the Ministry of Trade and Industry attributed the sharp increase in the price of motorbikes to the ongoing chip shortage and production cost after the COVID-19 pandemic.

Over the months, the local motorbike market has seen a “fever” in price. However, bike dealers do not have enough bikes for sale, so clients have to buy new bikes at higher prices.

When asked by the local press, Honda Vietnam said they could not interfere with bike dealers to reduce retail prices. The company always tried to ensure sufficient production to keep retail prices nearly similar to listed prices.

A bike shop owner in Hà Nội said the problem was that Honda Vietnam could not ask its bike dealers to reduce prices as it directly sold its products to local wholesalers with specific contracts.

The representative of the Industry Agency said currently, Việt Nam was unable to make processor chips, still largely depending on imports from China, Korea, and Japan. And most of them were imported from China.

Meanwhile, China’s zero-COVID policy has greatly impacted manufacturers hitting business operations. Many factories have operated moderately or closed temporarily, causing a shortage of chip supply for the automotive, electronics and motorcycle industries.

The representative said Intel was working with the Ministry of Planning and Investment (MPI) to open a chip assembly plant in Việt Nam providing chips for the computer industry only.

Motorbikes were still in short supply due to a lack of chips imported from China. The fastest solution was to wait for the change of China’s “Zero COVID” policy.

According to the Vietnam Industry Agency the local motorcycle industry currently accounts for between 80-90 per cent of foreign-invested enterprises (FDI).

With the large purchasing power, motorcycle manufacturers such as Honda and Yamaha all assemble bikes and attract their suppliers from abroad to Việt Nam.

Many Vietnamese enterprises were providing motorcycle parts but mainly focusing on simple spare parts, said the Agency’s representative.

Government Decree No.111/2015/NĐ-CP dated November 3, 2015, focused on the development of the supporting industries of textiles and garments, leather, electronics, mechanics, automobiles, and high technology. Thus, there is no separate policy for the motorcycle industry.

According to the agency, the Ministry of Industry and Trade will study and issue general policies for the mechanical engineering industry relating to the motorcycle industry.

The Ministry of Industry and Trade has been working with several companies such as Samsung, Honda, and Toyota to conduct training courses and improve production, management, and quality control of production processes.

Local businesses that can improve production capacity and the product value chain will be asked to become involved in production for the bike and automotive industry. -- VNS

Used bikes going up in price

HÀ NỘI — Over the month, the sales volume of used bikes was up by 30 per cent compared to 3-4 months ago. In addition, the selling price of used bikes increased from between VNĐ2 million to VNĐ10 million.

Popular bikes such as Honda Blade, Wave Alpha, and Yamaha Sirius have seen an increase in the price of between VNĐ2-3 million. Meanwhile, scooters like Honda Vision, AirBlade and SH area are the most sought after, with prices going up between VNĐ5-10 million.

The price of a used Honda Vision 2022 is offered at VNĐ47 million. This is VNĐ12 million higher than the list price (VNĐ35 million). A special edition Honda Vision 2021 that has travelled just 1,000 km is now offered at VNĐ49.5 million, some VNĐ14.5 million higher than the list price.

Nguyễn Văn Hiên, a bike trader in Huế street, said production of the most-sought bikes failed to meet demand, and local clients should wait as bike manufacturers were seeking ways to optimise their production capacity.

In addition, local users can choose similar models from other motorcycle manufacturers sold at reasonable prices to avoid paying extra money as it’s not worth it, said Hiên.

Honda, which has an 80 per cent share of the motorbike market in Việt Nam, is facing a parts shortage. The automotive and motorcycle industry has suffered from the COVID-19 pandemic and economic and political volatilities leading to a shortage of spare parts and higher production costs.— VNS

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