Hanoi's ICE Motorbike Ban: Honda Faces Job Cuts, EVs Charge Ahead
Hanoi's Motorbike Ban Accelerates: Honda Faces Job Cuts, EVs Charge Ahead
October 21, 2025, Hanoi, Vietnam / Darwin Zialcita
Vietnam's capital Hanoi is on track to ban fossil fuel-powered motorcycles from its city center starting July 1, 2026, under Prime Minister Pham Minh Chinh's Directive 20 issued in July 2025. The policy targets the area inside Ring Road 1, a 30 km loop covering central districts like Hoan Kiem and Ba Dinh, affecting up to 2 million daily commuters. No exemptions apply to internal combustion engine (ICE) two-wheelers, regardless of age or type; electric vehicles (EVs) and public transport are promoted with subsidies of $120–$200 for qualifying buyers purchasing EVs costing at least $590.
The directive mandates a phased rollout: full ban inside Ring Road 1 by mid-2026, expansion to Ring Road 2 by January 2028, and Ring Road 3 by 2030. Nationally, similar curbs are planned for Ho Chi Minh City by 2027–2028, framing Hanoi as a pilot for Vietnam's net-zero emissions goal by 2050.
Hanoi's air pollution crisis drives the ban: PM2.5 levels routinely exceed WHO limits by 5–10 times, earning it the title of world's most polluted metropolis in 2025. With ~8 million motorbikes in the metro area fueling congestion and emissions, the policy aims to slash urban air toxins and promote green mobility, including expanded EV charging networks. A September 2025 survey found 60% of riders willing to switch to EVs if affordable, though infrastructure gaps persist.
Honda, commanding 80% of Vietnam's $4.6 billion two-wheeler market with 2.6 million units sold in 2024, reports a 22% sales drop in August 2025 post-announcement, with partial September recovery. The firm, supporting 200,000 jobs via factories, dealers, and suppliers, has accelerated EV models like the ICON e: but warns 99% of sales remain petrol-based. In July, the Vietnam Association of Motorcycle Manufacturers (VAMM)—led by Honda, with Yamaha and Suzuki—petitioned authorities for a 2–3 year delay to build charging infrastructure and standards. On October 21, Japan's embassy in Hanoi formally warned of factory shutdowns and supplier bankruptcies, urging a "staged roadmap" to avert economic fallout. Yamaha and Suzuki echo these concerns, committing to no closures while pushing EV production.
"Reducing emissions is a global issue requiring joint efforts 'to choose the most optimal solution with a suitable roadmap'," Chinh said in August to Japanese execs, stressing a balanced EV shift.
Public response mixes support for cleaner air with livelihood fears; enforcement details like vehicle scrappage remain unclear. Local EV maker VinFast saw 55% sales growth to 70,000 units in Q2 2025, positioning it to erode Honda's dominance.
No evidence supports Chinese government control over the ban, a Vietnamese initiative inspired by policies in Guangzhou since 2006. However, Chinese firms like BYD gain from Vietnam's EV incentives, indirectly boosting regional expansion amid the shift. Unsubstantiated online theories link VinFast's Vingroup to policy influence, but official sources attribute it to environmental imperatives.
Public & Local Wins
- Rider vibes: Cheers for fresh air, groans over lost gigs (deliveries, commutes). Hanoi resident Mai says, "Pollution in Hanoi is alarming... The main culprits are ‘exhaust fumes from motorbikes’," but notes "half agree to change and half do not." Grab driver: "Some drivers can’t even earn enough to cover basic meals."
- EV boom: VinFast (local champ) sales up 55% to 70K units in Q2 2025—ready to steal Honda's thunder. Fellow Nguyen Khac Giang warns, "It’s just a mess... In a very short span of time, it’s really difficult," citing grid strains and costs for the poor.
- Enforcement details fuzzy: A doctor calls it a recipe for "social chaos."The Road Ahead
Hanoi's setting up globally for a cleaner future, but the bumps—economic hits, rider resistance, and EV rollout glitches—could slow the ride. Will this spark the Southeast Asian EV wave, or force a U-turn on the timeline? What's your take?
Additional source:
https://apnews.com/article/vietnam-evs-motorbikes-yamaha-vinfast-4ab76826787a806392655b843c374f3a
https://www.reuters.com/sustainability/climate-energy/japan-warns-vietnam-job-losses-hanoi-motorbike-ban-hits-honda-2025-10-21/
