Last week, Honda announced the start of production of the ICON e: at its Vietnam plant. The ICON e: would be Honda’s first electric scooter to be locally manufactured. This is important for the Vietnamese market as it signals that Honda is getting serious about electric scooters in Vietnam.
Honda has a more than 70% share of the two-wheeler market in Vietnam, estimated at 2.85m units. Yet, it has been absent in the E2W market that has been cornered by local manufacturers and Chinese scooter importers. Honda wants to change the status quo with both the CUV e: and ICON e: electric scooters heading to Vietnam. It is likely that the CUV e: scooter would be shipped from Indonesia.
Vietnam has one of the highest two-wheeler densities of about 700 per 1000 individuals.
We estimate electric two-wheeler sales in Vietnam in 2024 to be about 150k two-wheelers, putting the penetration of E2Ws at about 5.3%. However, importantly, the Chinese have run through the market in the last decade – there are more than 2.3m electric two-wheelers on the country’s roads. Most of these are slow-speed (< 25 kph) and require no license. A large share of these scooters run on lead-acid batteries.
Many of these slow-speed scooters would come up for replacement in the coming years, driving the demand for cost-effective E2Ws. Honda is trying to grab some of that market with the ICON e:.
The current E2W market is split between Vinfast, Dibao, Yadea, Pega, Anbico, DK Bike, and many much smaller brands importing scooters from China. The locally developed brands are Vinfast and Dat Bike, with Dat Bike targeting the premium segment.
ICON e: as a Part of Honda’s Asia Strategy
In every important market – India, Indonesia, Vietnam – Honda is following a multi-scooter strategy when it comes to electric. While the flagship scooter – Activa e: / CUV e: is energised by the Honda MPP, the slightly smaller scooter (ICON e: / QC1) carries a floorboard-mounted battery – fixed in the QC1 and removable (but not swappable) in the ICON e:.
However, the Indonesian market also gets the EM1, a scooter very similar to the ICON e:. The key difference is that the EM1 uses a single Honda MPP swappable battery, instead of the fixed battery found in the QC1 and the ICON e:. It remains to be seen when the EM1 makes its way to Vietnam and India, if at all.
The ICON e: is a critical scooter for Honda in Vietnam. With a 1.8kW (peak) hub motor and a top speed of only 49 kph, it does not need a license, making it easier for high school and university students to buy one. That’s an important market, something that Vinfast has been targeting with multiple models. Most of the Chinese IP importers offer multiple models in this segment.
Energy comes from a 1.46 kWh battery pack that sits inside the floorboard and can be removed for charging, though there is a scooter-mounted charging socket as well.
On the specs side, Honda has a compact and lightweight scooter, even though the wheelbase is not too different from the CUV e: (1298mm vs 1310 mm).
The price of VND 29m (USD 1130), excluding the battery subscription, is attractive for the segment, but still much higher than the Vinfast Motio, also a recently launched compact scooter, and the lowest price offering from Vinfast.
It is priced at VND 17.9m, ex-battery. Apart from the Motio, Vinfast also has the Evo 200 Lite and Evo Lite Neo scooters in the same segment (top speed <49 kph).
ICON e: vs QC1
Honda wants to follow a two-electric scooter strategy in the biggest markets. In the Indian market, it has launched the Activa e: (equivalent to the CUV e:) that uses the MPPs for energising. It also has the QC1, a slightly smaller scooter with a 1.8kW hub motor and a 1.5kWh fixed battery, exactly the configuration it uses for the ICON e:.
While the QC1 looks heavier, it is actually the smaller scooter here in terms of wheelbase. The marked difference between the ICON and the QC1 is the market positioning. The QC1 is targeted at the utility seekers, while the ICON e: is aimed at school and university students.
Impact
Honda is going after the volume segment with the ICON e:. With local manufacturing, they have managed to achieve competitive pricing, important in a segment that is fast growing but is also price inelastic.
With the launch of the ICON e:, Honda now has two scooters in Vietnam. We find it highly likely that the EM1 would follow as well as it gives Honda more options.
The three scooters in Asia – CUV e: / Activa e:, EM1, and ICON e: indicate Honda’s strategy of using the same component basket to create a range of products.
InsightEV – Global Electric Mobility
InsightEV – Global Electric Mobility
InsightEV – Global Electric Mobility
