Firms show interest in local e-scooter market
Firms show interest in local e-scooter market
Domestic and foreign enterprises have increased investments in the electric scooter business, following the increasing popularity of electric scooters in major cities.
Electric scooter producer Pega launched a new model, NewTech, on January 11 with a selling price of VND25 million. This e-scooter model, initially sold at a promotional price of VND22 million, is directed at male users and has a driving range of 90 kilometers per charge. The e-scooter battery can be used as a source of energy for mobile phones.
Pega has previously manufactured models for female users of different age ranges.
To attract customers since VinFast Klara e-scooters have already been introduced, Pega will allow customers to return the scooters within three days if they are not satisfied for any reason, a rare move among manufacturers.
Doan Linh, general director of Pega, stated that the firm was confident enough in the product to introduce the return policy on NewTech e-scooters. He had tested the e-scooter for months before the model was launched.
According to Linh, Pega understands its customers have real needs when they decide to buy.
Moreover, Linh said, if Pega does not provide a firm commitment and follow through, the firm will have no motivation for growth.
Over the past three years, Pega has sold some 30,000 scooters per year.
In addition to Pega, Vingroup joined the e-scooter market last November with the launch of the VinFast Klara. This model is priced at VND57 million for the version with a lithium-ion battery and VND34 million for the version running on a lead-acid battery.
When VinFast Klara was first introduced to the market, discount prices were used to attract customers, at only VND21 million per e-scooter with a lead-acid battery and VND35 million for those with a lithium-ion battery. The selling prices were then hiked to VND25 million and VND39.9 million, respectively.
According to e-scooter distributors, VinFast Klara e-scooters have received positive reactions from customers. Some 15,000-20,000 e-scooters were preordered during the launch, which is considered impressive for a new brand in the field.
Linh expressed pleasure over Vingroup’s interest in e-scooters. He added that the firm must have taken into account all financial matters and marketing activities.
It seems that customers no longer regard e-scooters simply as a medium of transport for students as e-scooters could replace conventional bikes in the future, Linh said.
“We find it a good thing that there are more domestic firms manufacturing e-scooters. Vietnam’s e-scooter market is still new and there are many opportunities. With new firms joining the market, e-scooters will be more popular,” he added.
The localization rate of e-scooters produced by domestic firms currently ranges from 30% to 80%.
Vingroup late last year teamed up with VNPost Petrolimex and PV Oil to set up 30,000-50,000 charge points and shops nationwide as part of efforts to popularize e-scooters.
E-scooter and e-bike shops in Vietnam sell both domestic products and Chinese-made products, which have lower prices and a shorter battery life.
Vietnam consumes an estimated 400,000 e-scooters and 7,000 e-bikes per year, whereas the consumption of regular motorbikes is some 3.3 million units.
Based on the attractiveness of Vietnam’s e-scooter market, MBI of South Korea last December said that it would launch three e-scooter models in Vietnam late next month. DKBike will represent MBI in assembling and distributing these products in the Vietnamese market.
According to Yoo Moon Soo, chairman of MBI, while most e-scooters available in Vietnam have capacities equivalent to 50cc and a maximum speed of 50 kilometers per hour, MBI scooters can be as powerful as a 110-125cc scooter and run at up to 110 kilometers per hour.
MBI plans to open 500 battery charge/exchange points in Vietnam toward the end of this July and targets some 15,000 points by 2020. Up to US$1 billion may be needed to fund the plan.
MBI expects its e-scooters to gradually replace scooters that run on fuel. MBI Motors Vietnam targets a market share of 3% in the first year (some 100,000 units per year) and over 5% in the following years (more than 200,000 units per year).
Piaggio also plans to sell the e-scooter Vespa Elettrica, launched in Europe last November, in Vietnam this year. However, Chairman and General Director of Piaggio Vietnam Gianluca Fiume remarked that the Vietnamese e-scooter market is untapped but full of challenges.
The shift to e-scooters is still in the early stages. Though the e-scooter market is growing, it is necessary to observe the market reaction over the long term.
