Yamaha’s brand of Nouvo scooters received an unexpected advertisement boost after two Hollywood celebrities Brad Pitt and Angelina Jolie were photographed riding around Ho Chi Minh City on a black Nouvo during their trip to Vietnam last year.

The image of the cool actor driving an automatic scooter changed consumers’ perceptions that previously associated the model with female drivers.

Japanese renowned manufacturer Honda forayed into the market soon after, debuting a sporty-looking Air Blade model in April last year that domestic motorbike traders said was a breakthrough in design for automatic scooters.

The Honda Air Blade enchanted consumers and the current available supplies of the model have yet to meet overwhelming public demand.

The price of the Air Blade scooter on the black market is VND8-10 million (US$482-602) higher than the manufacturer’s original retail price of VND28.5 million ($1,766).

Figures revealed by Koji Onishi, general director of Honda Vietnam, show that more than 120,000 Air Blade scooters have been sold since it made its debut.

Yamaha replied in April this year by introducing a new 135cc scooter called the Nouvo LX at the price of VND29.2 million ($1,809).

Honda, in response, launched the Air Blade Repsol, which features a similar paint color as the firm’s Repsol racing team – well-known in the Motor Grand Prix circle.

But domestic motorbike traders said the race between scooter makers became fiercer as a third Japanese name entered the market.

In July last year, Suzuki released a more budget-friendly 125cc scooter called the Hayate, which became popular with students and residents on the outskirts of the southern hub as it was priced VND7-8 million ($421-482) cheaper than the two previous Japanese brands.

These developments had pushed the Attila scooter of Taiwan’s SYM company – which used to be one of the best-selling scooters in Vietnam last year – to the fringe of the market.

The company, however, reacted with a vengeance, releasing an Italian-styled Attila Elizabeth that motorbike traders have ranked as women’s favorite model, surpassing Honda’s Click, Yamaha’s Mio and Suzuki’s Emity.

Potential market

With a growth rate of 20-30 percent per year, Vietnam’s motorbike market is an extremely attractive target for foreign manufacturers.

Domestic analysts warn the competition between motorbike manufacturers has just begun and foreign companies are capturing market shares at a pace that leaves Vietnamese firms out of the loop.

Taiwan’s leading motorbike manufacturer Kymco had entered Vietnam in 2004 through cooperating with HCMC’s biggest motorbike-maker, Hoa Lam, to set up a joint venture known as Hoa Lam Kymco.

The Taiwanese firm originally bought a 30 percent stake in the joint venture, and has recently purchased another 60 percent to raise its shares to 90 percent.

Kymco plans to build a factory in HCMC’s District 2, which will not only produce scooters for the domestic market but also exports for foreign markets.

The firm expects to debut three new scooter models by the end of this year.

But the two biggest motorbike makers by market shares, Honda and Yamaha, didn’t stand pat on the sidelines.

Yamaha last year started constructing its second motorbike plant with the total investment of more than $43 million in Hanoi.

The plant is expected to open in October.

Honda also began to build a second motorbike factory adjacent to its first one in the northern province of Vinh Phuc last year.

Once operational, the new factory with a total investment of $65 million will manufacture 500,000 scooters a year, raising the firm’s gross output in Vietnam to 1.5 million vehicles per year.

Italy’s giant Piaggio has joined the fray with its construction of a $30-million factory located in Vinh Phuc Province, which, once completed, will be expected to produce more than 50,000 Vespa scooters annually.

“After entering China and India, investing in Vietnam was a crucial move for Piaggio in its worldwide development strategy,” said Piaggio’s Chairman Roberto Colaninno.

Source: TBKTSG