In a major push toward sustainable urban development, Ho Chi Minh City is rolling out an ambitious roadmap to transition 400,000 gasoline-powered motorbikes to Electric Motorbikes, targeting app-based drivers and delivery riders at the heart of the initiative.
Under the proposed scheme, the city aims to offer a suite of financial and policy incentives — including low-interest loans, old bike buybacks, and VAT refunds per electric ride — to encourage drivers to make the switch to greener alternatives.
A Green Shift for Gig Workers
The initiative, led by the Ho Chi Minh City Institute for Development Studies (HIDS), is expected to launch with a detailed roadmap in July. It specifically focuses on the high-activity group of ride-hailing and delivery drivers who significantly contribute to urban emissions due to their long daily distances and peak-hour operations.
According to HIDS director Le Thanh Hai, the transition plan is designed to reduce costs for drivers and make electric motorbikes a financially viable alternative. “If drivers use their fuel savings to finance their new electric vehicles, they won’t need to make any upfront investment,” he said.
A survey of over 400 drivers revealed that they drive an average of 80–120 km per day, spending about VND 70,000–100,000 daily on gasoline — which increases by 20–40% during traffic-heavy periods. In contrast, electric motorbikes cost only around VND 20,000 per day to operate, potentially saving drivers VND 1–2 million per month.
Financing the Transition
To bridge the gap, the city is working with CEP Microfinance and several commercial banks to offer 24–30 month loan packages with repayment amounts equal to fuel savings. In addition, under Resolution 198, the city will subsidize at least 2% of loan interest rates. For instance, if a commercial loan carries an 8% rate, drivers will only pay 6%, with the remainder covered by the city budget.
Moreover, the city has proposed to the central government a range of tax and fee waivers:
- VAT and registration fee exemptions for first-time electric motorbikes buyers (approx. VND 3 million per electric motorbikes)
- VAT refunds for each electric ride completed — for example, VND 6,400 back on an 80,000-ride
Retiring Old Vehicles & Boosting Industry
The plan also addresses aging, non-compliant gasoline bikes, offering a buyback policy for those with high emissions or costly maintenance. Recycling businesses participating in this program will also be eligible for loan support.
To ensure a competitive, non-monopolistic market, manufacturers and electric motorbikes distributors will receive interest subsidies in exchange for reduced retail prices, allowing drivers to select from a range of quality, affordable vehicles.
Infrastructure & Support Systems
Ho Chi Minh City will also invest in essential electric motorbikes infrastructure — charging stations, rest stops, and battery-swapping services — with a strong preference for renewable energy sources. Investors in this green infrastructure will also be eligible for preferential loans.
To minimize credit risks, HIDS has proposed that the Credit Guarantee Fund partner with local authorities to help track bad debt and ensure repayment compliance.
A Step Toward Carbon Goals
According to Le Trung Tinh, Chairman of the HCMC Passenger Transport Association, the initiative is a logical step for a megacity battling high traffic emissions. Transitioning the most active segment of riders could make a significant dent in air pollution.
Companies like VinFast, through its Xanh SM ecosystem, have already deployed electric motorbikes in several provinces, creating favorable conditions for a rapid transition. Meanwhile, ride-hailing firm Be Group has taken the lead in adoption, with electric motorbikes now accounting for 10% of its 500,000-partner fleet.
Be Group is also offering purchase incentives such as:
- 4% discount on VinFast Feliz S
- VND 3 million discount per vehicle
- 30% off battery-swap fees in the first year with Selex electric motorbikes
Still, companies stress the need for more support in infrastructure, software, and battery costs to ensure a smooth and sustainable rollout.
Looking Ahead
Alongside motorbikes, Ho Chi Minh City has also set a goal for 100% of its buses to run on green energy by 2030. Currently, 31% of the city’s 2,200 buses already use electric or CNG power.
This motorbike electrification campaign is a key part of HCMC’s broader Emissions Control Plan, contributing to Vietnam’s commitment to reduce greenhouse gas emissions by 9% by 2030. The city is also exploring the possibility of selling carbon credits under this initiative.
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Source: Vietnam Insider