What Germany can learn from Vietnam’s electric two-wheeler market

Vietnam’s electric two-wheeler boom

In Vietnam, two-wheelers are essential. Roughly eight out of ten people rely on them for daily transportation, and by 2020, there were over 65 million two-wheelers on the road. This reliance has contributed to Vietnam having one of the highest two-wheeler ownership rates globally, as well as significant greenhouse gas emissions from the transport sector.

However, Vietnam is making significant strides toward reducing its emissions, particularly through the adoption of electric two-wheelers. While still representing a small fraction of the total two-wheeler market—around 2,3% in 2023—electric two-wheelers have seen notable growth in recent years. This growth has positioned Vietnam as the largest E2W market in Southeast Asia and the second largest globally, behind only China.

Several factors have contributed to this shift. The affordability of E2Ws, combined with increased local production, has made them more accessible to the average consumer. Brands like VinFast, a domestic electric vehicle manufacturer, have played a key role in this transition, partnering with international companies such as Bosch to enhance production capabilities and bring more options to market. Additionally, the Vietnamese government has actively supported this transition through policies aimed at reducing emissions and promoting electric vehicle adoption.

Affordability and accessibility: Key drivers of adoption

One of the most significant advantages of electric two-wheelers in Vietnam is their affordability. Compared to electric cars, E2Ws are much more cost-effective, both to purchase and maintain. Operating costs are also lower—E2Ws cost just a fraction of what it takes to run a traditional internal combustion engine (ICE) vehicle. For a population where motorcycles are a primary mode of transportation, this makes E2Ws a compelling alternative.

Accessibility is another key factor. Vietnam’s electric two-wheelers are widely available across the country, and companies like VinFast have invested heavily in developing a network of charging stations to support them. With 150.000 charging ports distributed across all provinces, finding a place to charge an E2W is increasingly convenient.

Lessons for Germany: A focus on affordable urban mobility

Germany’s efforts to decarbonise transportation have largely focused on electric cars, but there’s untapped potential in smaller electric vehicles like two-wheelers. Vietnam’s experience offers valuable insights into how Germany could encourage its citizens to adopt electric two-wheelers, especially in dense urban areas where they provide a practical alternative to cars.

One of the first lessons is the importance of affordability. Vietnam’s success with electric two-wheelers is rooted in their low cost compared to other vehicles. For Germany, promoting affordable electric two-wheelers could help accelerate the shift toward greener transportation. Introducing subsidies or tax incentives for E2Ws, much like those already in place for electric cars, could make them more attractive to a wider audience. For city dwellers, where space is often limited and traffic congestion is a major issue, E2Ws could provide a convenient and efficient solution.

Local production and strategic partnerships

Vietnam’s rapid growth in the E2W market has been bolstered by partnerships between domestic companies and international enterprises. By collaborating with global firms like Bosch and Samsung SDI, Vietnamese manufacturers have been able to scale up production and improve technology, making their products more competitive.

Germany, with its well-established automotive industry, could benefit from a similar approach. Encouraging collaborations between German companies and international electric two-wheeler manufacturers could help accelerate the development of high-quality, affordable E2Ws. This, in turn, could open up new market opportunities for German manufacturers both domestically and abroad.

Expanding charging infrastructure

Vietnam’s success in rolling out charging infrastructure for electric two-wheelers is another key area where Germany could learn. Although Vietnam still faces challenges related to standardisation, private companies like VinFast have made significant strides in making charging more accessible. Germany, with its existing electric car infrastructure, could similarly invest in expanding charging stations for two-wheelers. Incorporating these stations into the broader electric vehicle network would make it easier for users to transition to electric two-wheelers, reducing one of the main barriers to adoption.

Urban mobility solutions for the future

Germany’s urban centers face many of the same challenges as those in Vietnam—congestion, emissions, and space limitations. Electric two-wheelers offer a solution that addresses all these issues. They’re smaller, easier to park, and more agile in traffic, making them ideal for navigating crowded city streets. Vietnam has already seen the benefits of increased E2W use, and Germany could replicate this success by encouraging their use in urban areas.

Promoting electric two-wheelers would not only help reduce emissions but also ease congestion in cities. German policymakers could introduce targeted incentives for urban residents to switch to E2Ws, particularly for short commutes or delivery services, where these vehicles excel. This would complement Germany’s existing focus on reducing car dependency and promoting sustainable mobility solutions.

Addressing safety and regulatory concerns

Vietnam’s experience with electric two-wheelers has also highlighted the importance of addressing safety concerns. Electric two-wheelers are quieter than their traditional counterparts, which can increase the risk of accidents in urban environments. Additionally, there are concerns about battery safety and performance in flood-prone areas, which are particularly relevant for a country like Vietnam.

Germany can learn from these challenges by introducing appropriate safety regulations early in the transition to electric two-wheelers. Measures like acoustic warning systems or improved road infrastructure could help mitigate the risks associated with quieter vehicles. Additionally, Germany could invest in research and development to improve battery safety and performance, ensuring that electric two-wheelers are both safe and reliable in all conditions.

Conclusion

Vietnam’s rapid adoption of electric two-wheelers offers a blueprint for other countries looking to reduce emissions and promote sustainable urban mobility. For Germany, focusing on affordable, accessible electric two-wheelers could help accelerate the transition to greener transportation. By learning from Vietnam’s success, Germany has the opportunity to expand its electric mobility options, reduce congestion, and lower emissions in its cities, paving the way for a cleaner, more sustainable future.

Source: The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)