When Vietnam turns the page on the combustion engine, Japan fumes and Honda coughs. In July, Pham Minh Chinh's government signed a historic directive: banning gasoline-powered motorcycles in central Hanoi by mid-2026, before a gradual expansion in 2028. Officially, the objective is clear: to combat urban pollution. Unofficially, it's a diplomatic and industrial bombshell.
Behind the Vietnamese announcement, a colossus is faltering: Honda, a true two-wheel empire in Southeast Asia. With 80% market share in Vietnam — or 2,6 million of motorcycles sold in 2024 — the Japanese manufacturer embodies the motorcycle itself for millions of Vietnamese.
But this domination is suddenly weakened. Since the publication of the decree, Sales fell 22% in August compared to July, and double-digit declines followed one another over two months.
A representative of Honda, on condition of anonymity, even told Reuters that production could be revised if the plan was not adjusted - while publicly assuring that no factory closures were planned.
The message from Tokyo is clear: slow down the schedule. The Japanese embassy in Hanoi sent a diplomatic note to the Vietnamese government, warning that such an abrupt change could “affect employment in related sectors,” particularly among dealers and suppliers.
The text calls for an “appropriate roadmap” towards electrification, with a preparatory period and gradual implementation.
Behind this official position, Japanese manufacturers - led by Honda, but joined by Yamaha et Suzuki — fear an industrial domino effect.
"Too rapid a transition could cause production disruptions and bankruptcies in the supply chain,” they warned, pleading for “two to three additional years" in order to adapt lines, deploy charging stations and set stable safety standards.
While Honda falters, a local player is enjoying its revenge: VinFast.
The Vietnamese manufacturer, already launched in electric cars, saw its sales of electric motorcycles and bicycles jump by 55% in the second quarter. And September surveys predict a dramatic acceleration as the ban approaches.
This shift also benefits other local brands that are more agile in the electric segment, while registrations of thermal vehicles have fallen by 18% in September.
Toyota, which still dominates the car market, is watching the scene cautiously - but the signal is clear: Vietnam wants to break away from dependence on Japanese engines.
For Japan, the Vietnamese move is not just an industrial setback, it is a crack in a decades-old strategic partnership.
Tokyo has invested heavily in Vietnamese industrial development, Honda being one of the most visible symbols of this cooperation.
Today, the shock is as much political as economic. Japan fears a loss of influence in a region where China grows its own technologies electrical.
Hanoi, for its part, asserts its industrial sovereignty by favoring national champions of green mobility.
Vietnam wants to breathe, but Japan is suffocating: between the Vietnamese ecological emergency and Japanese industrial dependence, the duel promises to be brutal.
And in the short term, one certainty emerges: Honda will be the big loser in this green war.
