Table 1. The motorcycle consumption ratio in some Asian Developing Countries

  Source: KOTRA's survey

 ○ According to the Ministry of Industry and Trade, the total motorbike output in the world is 43 million products a year, 42% of which comes from China, 15% from India and 22% from South East Asia. Asia is the biggest market which consumes 80% of the total output. China consumes 10 million products a year, India 5 million, Indonesia 5 million, Thailand 2 million, Vietnam 3 million, while Japan and Taiwan 10 million. The Vietnam Automobile Motorcycle Bicycle Association(VAMOBA) stated that about 3.11 million motorbikes were sold in Vietnam in 2012, down 200,000 compared to the previous year. The year 2011 saw the highest sales of motorbikes in the last decade. The situation has been blamed on both the economic downturn and new higher vehicle fees. The following chart 1 show number of motorcycle sold in Vietnam during past years.

□ Local production and importation

 ○ The statistics revealed by Vietnam Registration, in Vietnam, there have totaled 50 motorbike assemblers and manufacturers named as Honda, Suzuki, Yamaha (Japan), SYM (Taiwan), Lifan (China) etc. Outstandingly, the production volume has been on the year-on-year increase. Concretely, as of 2009, the number of motorbikes assembled and manufactured amounted to 2.86 million, slightly reduced by 1% against the 2008. However, in three years in a row (2006~2008), the motorbike number constantly grew with the growth of 375,000 pieces.

Chart 3: Volume of motorcycles assembled in Vietnam (2006~2009)

         (Unit: 1,000 pieces)

Source: Vietnam registration, General Statistics Office

 ○ The competition in the motorbike industry, especially among major participants in the market consisting of Honda Vietnam, Yamaha Vietnam, Suzuki Vietnam, and SYM Vietnam has been increasing fierce. With the largest market share of around 63%, at present, Honda Vietnam is the leading motorcycle manufacturer in Vietnam (see chart 4). In 2011, the Honda manufacturer sold 2.1 million products, including the 300,000 products exported to the Philippines, Laos, Cambodia and Afghanistan. By the end of 2012, the new factory of Honda Vietnam, located in Ha Nam province, would become operational, raising the total capacity to 2.5 million products per annum. Honda was still the most popular brand in Vietnam, with 1.95 million sold last year. Yamaha was second, with 800,000 units sold, followed by SYM.

 ○ Other than the motorbike manufactured and assembled, Vietnamese demand for motorbike is also tailored by the imported products. However, the year 2011 marked the disappearance of many brands. In 2010, Ducati, Kawasaki, CPI or Harley Davidson were once famous on the market. Meanwhile, in 2011, only Rebel USA was still familiar to people. The weak demand on the domestic market could be seen in the low imports in 2011. According to the General Statistics Office, Vietnam imported 66,000 motorbikes worth 94 million dollars, a decrease of 38.9% in quantity and 27.8% in quality. In the last month of 2011, only 3,000 motorbikes in the form of complete built unit (CBU) were imported, worth five million dollars, a decrease of 1,000 motorbikes in quantity and 1 million dollars in the import turnover.

Source: Vietnam Registration, Vietnam General Customs Office; and General Statistics

2. Overview market of Motorcycle Anti-theft device in Vietnam

□ Demand Trend

 ○ Demands for Motorbike Anti0theft device has been increasing during recent years as a result of two main facts stated bellows:

  - As stated in the part I, it is clear that Vietnam is the leading country in the world in terms of the number of motorbikesused. With Vietnam’s burgeoning motorbike culture, there were more than 33 million motorbikes in the country– it’s a massive market for a motorbike thief.

  - Motorcycle theft statistic: Ho Chi Minh, the biggest city in Vietnam where many motorcycle thefts happened during a year. According to statistics from the Police Department, there were 167 motorcycle thefts in Ho Chi Minh City in only December, 2009. Nearly 2 years later, there were 1,164 thefts in the city, in which up to 577 are motorcycle thefts with 738 stolen motorcycles in the first 6 months of 2012. Mostly, stolen motorcycles are medium and high-end brand name, including Honda Air blade, Honda Lead, Piagio, LX, SH, etc. The same situations have been happening in the capital of Hanoi and other cities/ villages in Vietnam.

 ○ Local production of Motorcycle Anti-theft device

  - There can be divided into 2 trends, that is:

   · Produce smart anti-theft devices - Currently, there are very few local producers that can manufacture smart anti-theft devices.

 ① Setech Viet Software Solution Join Stock Company (Setech Viet) is one few local producers which can make a motorcycle anti-theft device successfully. They just released a device that allows users to text their own motorbike if she/he has lost it. Bellows is the information of Setech Viet.

Source: www.setechviet.vn

 ② Viet Quang Technology Solution Manufacturing Joint Stock Company

Source: www.khoaxemaythongminh.com

   · Use manual methods:

 ① Viet Tiep Lock is one of the most popular brand name in term of lock and key in Vietnam market.

Source: www.khoaviettiep.com.vn

 ② Use hidden key: The started will be modified with another key, which is hidden in ‘can’t find’ place inside motorbike. And motorbike users only need to turn on/off the switch to start the motorbike. This method is very favorable in Vietnam, especially in Ho Chi Minh City due to less expense.

 ○ Competition Situation of Motorcycle Anti-theft device

  - There are just a few local smart anti-theft device producers in Vietnam. Therefore, the competition is intense just among foreign suppliers. Presently, the market of Motorcycle Anti-theft device has been occupied by major supplier including Taiwan, and China. According to KOTRA’s survey, every 8 of ten asked motor accessories retailers are trading Taiwan and China motorcycle anti-theft device. In Hanoi, such digital anti-theft locks can be easily found in motor part and accessories shops in Hue street, and some others in the whole city. Needless mention that the competition is fierce in term of using normal locks including Viet Tiep Lock, Viet Thai Lock from Vietnam, and Z-CON from Taiwan due to less expense. The competition is much fiercer in term of price, which is further discussed in next part. Hence, if PLATO wants to enter Vietnam market, it is recommended to compete in price, and after-sale services (warranty policy).

3. Retailing pricing

 ○ Below are some offering price posting on the website of several trading companies in Motorcycle Anti-theft devices for reference. Note that the price quoted below is not the imported price but the selling price including all kinds of taxes and profit, and this price level can change over time.

Source: www.chongtromductien.com

4. Distribution Channel

 ○ Because Motorcycle Anti-theft device is just one of tinny motor accessories, and thus the method of distributing the product to the end-users through the local traders is the most common and effective way in Vietnam to utilize the agent’s connection and network with customers as well as provide customers with more responsive and practical technical support and after-sales services. And actually, existing players in the motorbike spare parts and accessories have been selling anti-theft devices through that distribution network.

5. Import barriers

□ Import Procedure

 ○ Since the Motorcycle Anti-theft devices are the normal commodity, there is no additional document that needs to submit for the customs clearance. The presentation of documents includes the common documents such as:

  - Contract

  - Certificate of origin (C/O)

  - Bill of Lading (B/L)

  - Certification of Quality (C/Q)

  - Packing List (P/L)

  - Commercial Invoice

□ Import Tax

HS Code 8708: Parts and accessories of the motor vehicles of headings 87.01 to 87.05

Note:

MFN: Most Favored Nations (Korea belongs to this group of nations)

CEPT: Common Effective Preferential Tariff (ASEAN 10 member countries)

AKFTA: ASEAN-Korea Free Trade Area

Source: Export–Import Tariff and VAT on Imports Book (Ministry of Finance)