VDF Motorbike Symposium
As part of the joint drafting process of the Motorbike Master Plan with MOI
March 21, 2007

Attendance was 115, including MOI and other officials, producers, experts, and media.

The Vietnam Development Forum (VDF) organized the Symposium on the Development and Management of Motorbike in Vietnam at Melia Hotel, Hanoi, on March 21, 2007. This was part of the ongoing joint drafting process of the Motorbike Master Plan, for which VDF plays the facilitator role.

The opening remarks were made by NEU Rector Prof. Nguyen Van Thuong and NEU Vice Rector Prof. Phan Cong Nghia, and Vice Minister Dr. Do Huu Hao of the Ministry of Industry. Dr. Hao continued to chair the first session of the symposium.

Prof. Kenichi Ohno (VDF/GRIPS) and Mr. Nguyen Anh Nam (chief drafter of this master plan, IPSI/MOI) each presented the drafting methodology, proposed contents, preliminary conclusions, and remaining issues of the master plan. The two presentations were basically similar in policy orientation and demand forecast, but there were some issues that need to be discussed before arriving at final conclusion.

The proposed master plan is being compiled with broad inputs from producers, policy makers, consumers and other stakeholders. It will contain user related social issues, such as traffic safety, congestion and air pollution, in addition to traditional supply issues such as production, competitiveness, and demand forecast. Under market orientation and globalization, the government role is to show vision, set standards for quality, safety, environment and industrial property, and enhance supporting industries and industrial human resources. There is a broad consensus that the state should not intervene in the business decisions of individual enterprises such as output, investment or export.

The master plan will argue that motorbikes should continue to be used in Vietnam to ensure people's mobility and reduce infrastructure costs, provided that sound and sustainable solutions are found and implemented in traffic, environment and intellectual property problems. It will also designate the motorbike industry as the principal industry for promoting supporting industries and industrial human resources.

After examining domestic and international data, the drafting team predicts that the motorbike stock will rise from about 18 million (5 persons/unit) in 2006 to about 33 million by 2020 (3 persons/unit). This is roughly the same density as in Thailand today. The urban-rural gap in motorbike ownership is expected to narrow significantly. As for annual domestic sales, the range of 2.0-3.5 million units per year seems consistent with various assumptions. The drafting team will have to work more to narrow and finalize annual demand forecast.

Following the two presentations, Dr. Mai The Cuong (VDF/NEU) reported the preliminary results of VDF's consumer survey conducted during March 5-20, 2007 through street interviews (1,981 respondents) and online voting on vnexpress, dantri, thanhnien and VDF websites (7,763 hits or about 4,000 respondents). Collectively, 50.3% of the people felt that motorbikes in urban areas should be controlled with a roadmap, 23.4% answered that they should be controlled immediately, and 26.3% said that they should not be controlled. VDF will report detailed results, including written comments and suggestions, separately.

Vice Minister Prof. Kenichi Ohno Mr. Nguyen Anh Nam Dr. Mai The Cuong
Do Huu Hao

Ohno slide E (PDF207KB) Ohno slide V (PD533KB) User survey (PDF40KB)
Preliminary ch.1 E (PDF104KB) Preliminary ch.1 V (PDF169KB)

Some Opinions during Free Discussion

Demand forecasts

Some people felt that the forecasts were reasonable but the method should be improved. Many said that projections based on household ownership of motorbikes needed reconsideration. The drafting team promised to look at the numbers more carefully. Others noted that using Thailand as the benchmark was inappropriate, since Vietnam and Thailand had different conditions. Prof. Ohno agreed, but explained that Thailand was just a reference point and the draft did not argue that Vietnam would become exactly like Thailand. If Taiwan or Malaysia were used as the benchmark, the stock demand would rise to 50 million units. But the drafting team thought that demand forecasts should be moderate and conservative, not ambitious. Another point raised was that traffic congestion depended on not just ownership per person but also frequency of motorbike travel of that person.

Export targets

Prof. Ohno argued that there should be no numerical export targets although encouragement of export was acceptable. Mr. Nam however presented tentative export targets, namely, $300m for 2010, $500m for 2015, and $0.8-1.0b for 2020. One MOI official said that numerical export targets were inappropriate when enterprises were competing freely under globalization and market orientation. Mr. Nam agreed that the state could not force firms to export, but explained that his numbers were just indicative targets. There was also discussion on whether the government should "restructure" weak local producers, or it should be left to market forces. The desirability of accelerating motorbike tariff reduction was also discussed, without any conclusion.

Policy measures for quality, traffic safety and environment

Many participants argued that there should be strong and concrete policies for improving urban air quality based on Euro standards, traffic regulations concerning helmets and reckless driving, etc. The drafting team agreed, and said that it was in the process of proposing concrete measures. But it also noted that specifying concrete measures was not easy when many ministries, not just MOI, were involved. Participants also debated whether quality standards should follow international or Japanese norms or Vietnam should have its own standards. The master plan draft, including concrete measures, will be made available in Vietnamese and English around April 2007.

Vietnam Motorcycle Manufacturers Association?

At present, Vietnam has the Vietnam Motorcycle and Bicycle Association, but its activities are limited and FDI producers do not participate in it. Separately, there is the Vietnam Automobile Manufacturers Association, which has strong participation of FDI producers, but it mainly concentrates on car issues. The lack of motorcycle business association in Vietnam is a problem, since without it it is difficult to create an effective link between government and enterprises, implement SME policies, or have cooperation with international organizations. How to reorganize the producer's association was raised as one of the important remaining problems.