Can electric bikes save Vietnam's most polluted cities? - Asia Specific podcast, BBC World Service

Key Concepts

• Electric Vehicle (EV) Adoption: Vietnam’s ambitious plan to transition to electric vehicles, particularly two-wheelers (e-bikes).
• VinFast: A major Vietnamese EV manufacturer, facing challenges in global markets despite domestic prominence.
• Chinese EV Model: The success of China’s EV industry, driven by state support, competition, and economic strategy.
• State Capitalism: The Chinese approach to EV development, combining state resources with entrepreneurial innovation.
• Air Pollution in Vietnam: The significant air quality issues in Hanoi and Ho Chi Minh City, a key driver for EV initiatives.
• Motorbike Culture in Vietnam: The central role of motorbikes in Vietnamese daily life, economy, and culture.
• Anti-China Sentiment: The existing wariness and, in some cases, hostility towards China in Vietnam, impacting business and policy.
• Infrastructure Challenges: The need for robust charging infrastructure to support widespread EV adoption in Vietnam.

Vietnam’s EV Push: Copying China or Forging its Own Path?

Introduction: The Pollution Problem & EV Ambition

Vietnam is grappling with severe air pollution, particularly in its major cities Hanoi and Ho Chi Minh City. The government is responding with a bold plan to transition over 70 million motorbike riders to electric bikes, mirroring, to some extent, China’s successful push for electric cars. However, the approach and potential outcomes differ significantly.

Motorbikes: More Than Just Transportation

Motorbikes are deeply ingrained in Vietnamese culture and economy. They represent freedom, are central to dating rituals (a man picking up a girl on his motorbike with her wrapping her arms around his waist), and serve as the primary means of public demonstration – specifically, the spontaneous “Dibao” celebrations following national football team victories, involving mass motorbike parades with drumming and horns, chanting “Vietnam vô địch!” (We are the champions). Researcher R.F. Hansen aptly described Vietnam’s capitalism as “running on two wheels,” highlighting the motorbike’s economic importance, supporting internal migrants and street vendors.

China’s EV Success: An Economic Strategy

Nick Marsh, a Business Reporter, explained that China’s EV push wasn’t primarily driven by environmental concerns, but by a strategic economic goal: avoiding the “middle income trap.” China aimed to become a global leader in a cutting-edge industry – electric vehicles – where it could compete effectively, unlike the internal combustion engine market dominated by Western and Japanese manufacturers. This involved massive state investment, fostering competition, and providing subsidies. The result is a thriving EV industry, exemplified by companies like BYD, now surpassing Tesla in global sales. China’s approach prioritized innovation and economic advancement, with environmental benefits as a byproduct. The shift has also dramatically altered cityscapes, making them noticeably quieter.

VinFast: Vietnam’s National Champion & Challenges

VinFast, a Vietnamese EV manufacturer, is central to the country’s EV ambitions. While enjoying domestic visibility and benefiting from a nationalistic desire to support a Vietnamese brand, it faces significant challenges. Sen Nguyen, a BBC Senior Journalist, noted that VinFast struggles to compete in international markets like the US, and its cars are often more expensive than alternatives. Despite this, there’s a strong motivation among Vietnamese consumers to support VinFast, given the limited number of globally recognized Vietnamese brands. However, sales figures haven’t yet met expectations. One anecdote shared was a father purchasing a VinFast EV five years ago, despite the higher cost, motivated by a sense of foresight and concern about air pollution. He did not receive any government subsidies at the time.

The Role of Chinese Companies & Political Sensitivities

Chinese companies, like BYD, are major players in the global EV market and naturally target Southeast Asian countries like Vietnam. However, a strong anti-China sentiment in Vietnam presents a hurdle. BYD had initially planned to build a factory in Vietnam in partnership with New Energy Holdings, but the deal fell through for undisclosed “business reasons.” This suggests a reluctance to allow Chinese companies to dominate the Vietnamese EV market, particularly given the government’s desire to promote domestic brands like VinFast.

Policy & Potential Pitfalls

The Vietnamese government recently announced a policy to ban gasoline-powered vehicles in Hanoi and Ho Chi Minh City, scheduled to take effect in July. However, there are allegations that this policy is primarily driven by economic considerations – specifically, supporting VinFast – rather than solely addressing air pollution. There is debate over the actual sources of air pollution in Vietnam, with some arguing that farming practices contribute significantly, not just motorbikes. Furthermore, Vietnam lacks the comprehensive framework for EV industry development that China established. Significant infrastructure challenges, particularly the availability of charging stations, remain unaddressed.

Can Vietnam Succeed?

Sen Nguyen expressed cautious optimism, suggesting that assessing Vietnam’s success will require a long-term perspective (around 25 years). Nick Marsh emphasized the importance of fostering competition, as China did, and backing it with substantial investment. The Vietnamese approach, currently focused on supporting a single national champion (VinFast), differs significantly from China’s model.

Notable Quotes:

• R.F. Hansen (via Sen Nguyen): “Vietnam’s capitalism is running on two wheels.” – Highlighting the centrality of motorbikes to the Vietnamese economy.
• Nick Marsh: “I’d love to say it was about air pollution, Mariko, but… the cynical business reporter in me often wins out. It’s a convenient byproduct of developing your electric vehicle industry.” – Regarding China’s EV push.
• Sen Nguyen: “There is a very powerful anti-China sentiment… That's a very dangerous, well, not dangerous, but like sensitive combination to have.” – Regarding the challenges of Chinese EV companies entering the Vietnamese market.
• Mariko Oi: “I think the two biggest lessons that I've learned today, the similarities between Italy and Vietnam, and also the fact that Vietnamese authorities never admit that they've been looking at China as a success model.” – Reflecting on key takeaways from the discussion.

Conclusion:

Vietnam’s EV ambitions are driven by a desire to address air pollution and potentially foster economic growth. However, the country faces significant challenges, including infrastructure limitations, political sensitivities surrounding Chinese investment, and a different approach to industry development compared to China. Whether Vietnam can successfully transition to electric vehicles remains to be seen, and will likely depend on its ability to overcome these hurdles and potentially embrace a more competitive and comprehensively supported EV ecosystem. The success of VinFast, and the government’s willingness to address the underlying infrastructure issues, will be crucial factors.