Vietnam is implementing measures to support the transition to electric mobility as Ho Chi Minh City (HCMC) considers a financial support programme to promote the adoption of electric motorbikes.

HCMC is evaluating a subsidy scheme to encourage households to replace petrol motorbikes with electric motorbikes, with support ranging from 10-100% of the conversion cost, up to VND 20 million per household, according to a proposal from a consultancy consortium.

The proposal was submitted to the HCMC Department of Construction on 7th October 2025 as part of the city's Green Transport Transition Programme and low-emission vehicle initiatives.

Scope of the low emission zone (LEZ)

The city plans to establish a Low Emission Zone in the central districts from 2026, restricting non-compliant petrol and diesel vehicles. The proposed LEZ in central HCMC will cover former districts 1, 3, 5, 6, 8, 10, 11, Binh Thanh, Tan Binh, Tan Phu, and Phu Nhuan, bounded by 15 bridges and 17 main roads.

Vehicle restrictions in the LEZ

From 2026, three categories of vehicles will be subject to regulation within the LEZ:

- Heavy diesel trucks - fully banned
- Commercial vehicles - required to meet at least Euro 4 emissions standards
- Service motorbikes (e.g., ride-hailing) - required to meet Euro 2 emissions standards

By 2027, with mandatory emissions inspections for all motorbikes, enforcement will expand to all non-compliant vehicles.

Proposed financial incentives for households

- Regular households: 10% of conversion costs, up to VND 5 million
- Near-poor households: 80% of conversion costs, up to VND 16 million
- Poor households: 100% of conversion costs, up to VND 20 million

Additional incentives include a 50% reduction in vehicle registration and license plate fees and subsidised interest rates for electric motorbike loans.

Incentives for transport businesses

For commercial operators:

- 100% exemption from registration fees
- 50% reduction in road maintenance and license plate fees
- 50% interest support for vehicle investment in the first year

Electric bus operators can borrow up to 85% of investment costs with preferential interest rates for seven years.

Supporting infrastructure development

HCMC plans to support electric vehicle adoption with expanded infrastructure, including the installation of 750-1,338 charging stations at parking lots, shopping centres, and major roads.

The 2025-2026 period will focus on preparation and legal frameworks, with an estimated budget of VND 733 billion. Full implementation from 2026-2030 is projected to cost over VND 7,300 billion, excluding bus investment, with 80% financed by the city budget.

Context

HCMC has over 14 million residents and 13 million registered vehicles. Road traffic is a major contributor to particulate pollution, causing significant economic losses annually. The proposed subsidy programme aims to support the adoption of electric vehicles, reduce urban pollution, and address public health concerns.