Vietnam Electric Motor Sales Market Outlook to 2028

Vietnam Electric Motor Sales Market Overview

• Vietnam Electric Motor Sales Market is valued at 18 thousand units driven by increasing industrialization, the rising demand for energy-efficient motors, advancements in motor technology, and urbanization.
• The Vietnam Electric Motor Sales Market is highly competitive, with several key players dominating the landscape. Major companies include ABB Ltd., Siemens AG, TECO Electric & Machinery Co. Ltd., Toshiba Corporation, and WEG S.A.
• In 2023, ABB Ltd. announced the opening of a new manufacturing plant in Vietnam, aiming to increase its production capacity for electric motors. The new facility, located in Ho Chi Minh City, is expected to produce over 10,000 motors annually.

Vietnam Electric Motor Sales Current Market Analysis

• The increased focus on energy efficiency and sustainability has had a significant impact on the Vietnam Electric Motor Sales Market. Companies are now more inclined towards investing in high-efficiency motors to comply with regulations and reduce operational costs.
• In 2023, the government's push for energy efficiency led to the implementation of stringent regulations mandating the use of energy-efficient motors in industrial applications.
• In 2023, Ho Chi Minh City was the leading region in the Vietnam Electric Motor Sales Market. This dominance can be attributed to the city's robust industrial base, with numerous manufacturing and automotive companies operating in the area.

Vietnam Electric Motor Sales Market Segmentation

The Vietnam Electric Motor Sales market is segmented by various factors like Product, End-User, and Region.

By Product: The Vietnam Electric Motor Sales Market is segmented by product type into AC motors, DC motors, and hermetic motors. In 2023, AC motors dominated the market due to their widespread application in various industries such as manufacturing, HVAC, and automotive. The high efficiency and reliability of AC motors make them the preferred choice for industrial applications.

By End-User: The market is also segmented by end-user industry into manufacturing, automotive, and consumer appliances. In 2023, the manufacturing sector dominated the market due to the extensive use of electric motors in machinery and equipment. The sector's expansion, driven by foreign direct investment and government initiatives to promote industrial growth.

By Region: The market is segmented by region into North, South, East, and West Vietnam. In 2023, the Southern region dominated the market driven by the presence of major industrial hubs such as Ho Chi Minh City. The region's well-developed infrastructure and strategic location as a logistics center make it a prime area for industrial activities.

Vietnam Electric Motor Sales Market Competitive Landscape

• WEG S.A.: In 2023, WEG S.A. announced a partnership with a leading Vietnamese electric vehicle manufacturer to supply motors for their new line of electric scooters. This collaboration is expected to boost WEG's market share and strengthen its position in the rapidly growing electric vehicle segment.
• TECO Electric & Machinery: TECO Electric & Machinery Co. Ltd. launched a new range of IoT-enabled motors in 2024, aimed at providing real-time monitoring and predictive maintenance capabilities. This innovation is expected to revolutionize the industrial motor market in Vietnam by enhancing operational efficiency and reducing downtime.
• Siemens AG Expansion: Siemens AG announced in 2024 that it would be expanding its operations in Vietnam by opening a new research and development centre focused on electric motor technology with an investment of VND 2 trillion.

Vietnam Electric Motor Sales Market Analysis

Vietnam Electric Motor Sales Market Growth Drivers

• Industrial Expansion: The continuous industrial expansion in Vietnam has led to a surge in demand for electric motors, especially in sectors such as manufacturing, automotive, and construction. In 2024, the Vietnamese government approved new industrial zones, adding 1,500 hectares of industrial land to meet the growing demands of the manufacturing sector. This expansion is driving the need for more electric motors for machinery and equipment used in these industries.
• Electric Vehicle Adoption: The rise of the electric vehicle (EV) market in Vietnam is significantly boosting the demand for electric motors. According to the Vietnam Automobile Manufacturers Association, the number of electric vehicles on the road increased by 50,000 units in 2024 compared to the previous year. This surge is driven by government incentives for EV manufacturers and buyers, including tax exemptions and subsidies.
• Infrastructure Development: Major infrastructure projects, such as the North-South Expressway and urban metro systems, are driving the demand for electric motors. The Ministry of Transport announced a budget allocation of VND 100 trillion in 2024 for these projects, which require extensive use of electric motors for construction equipment, transportation systems, and auxiliary services. This increased investment in infrastructure is creating a substantial market for electric motors.

Vietnam Electric Motor Sales Market Challenges

• High Initial Costs: The high initial costs associated with energy-efficient electric motors pose a significant challenge, particularly for small and medium-sized enterprises (SMEs). A report by the Vietnam Chamber of Commerce and Industry indicated that SMEs account for 98% of all enterprises in Vietnam, and many struggle with the financial burden of upgrading to more efficient motors. In 2024, it was noted that the average cost of an energy-efficient motor is 20 million VND higher than standard models, deterring many SMEs from making the switch.
• Skilled Labor Shortage: Vietnam faces a shortage of skilled labor for the installation and maintenance of advanced electric motors. The country needs huge number of skilled technicians to meet the growing demand. In 2024, vocational training programs have been ramped up, but the gap remains significant, affecting the timely implementation and maintenance of electric motor systems across industries.
• Supply Chain Disruptions: Global supply chain disruptions have impacted the availability of key components for electric motors. The Ministry of Planning and Investment reported that delays in the supply of essential materials, such as copper and rare earth elements, have led to extended lead times and increased costs for electric motor manufacturers.

Vietnam Electric Motor Sales Market Government Initiatives

• National Energy Efficiency Program: Launched in 2024, this program aims to enhance energy efficiency across various sectors. The government allocated VND 3 trillion for subsidies and incentives to encourage the adoption of energy-efficient electric motors.
• Electric Vehicle Subsidies: The Vietnamese government introduced subsidies for electric vehicle buyers and manufacturers in 2024, allocating VND 5 trillion to support the EV market. These subsidies cover up to 20% of the cost of electric vehicles and related components, including electric motors.
• Industrial Zone Development: In 2024, the government approved the development of new industrial zones with a focus on sustainable and energy-efficient practices. A total of 1,500 hectares of industrial land was designated for new factories and plants, with incentives for businesses that adopt green technologies, including high-efficiency electric motors.

Vietnam Electric Motor Future Sales Market Outlook

The Vietnam Electric Motor Sales Market is poised for significant growth, driven by Increased Adoption of Smart Motors, Expansion of the Electric Vehicle Market, and Renewable Energy Integration.

Future Market Trends

• Increased Adoption of Smart Motors: Over the next five years, the Vietnam Electric Motor Sales Market will see a significant shift towards smart motors equipped with IoT capabilities. These motors will offer real-time data analytics and predictive maintenance features, leading to improved operational efficiency and reduced downtime.
• Expansion of the Electric Vehicle Market: The electric vehicle (EV) market in Vietnam is projected to grow exponentially fueled by continued government incentives, advancements in battery technology, and increased consumer awareness of environmental issues.