Motorbike sales will continue to slump as the Vietnamese market has almost reached a saturation point, industry insiders have said.

Vietnam’s motorbike market is in trouble and will continue to slow down in the near future because supply has already surpassed demand, according to Masayuki Igarashi, general director of Honda Vietnam.

Only 335,000 vehicles were sold earlier this year, a 3 percent slide compared to the same period last year, Igarashi said.

Igarashi predicted that motorbike makers will face a myriad of challenges in 2014 as the economy is still in a fragile state.

Moreover, the market is becoming more competitive as motorbike manufacturers have started to slash prices in order to lure customers.

Motorbike retail prices in Vietnam have decreased by VND500,000-2 million per unit and it seems they will only continue to decrease.

Even worse, many motorbike shops have already joined makers in cutting staff to avoid losses.

Kiyokazu Sasabe, deputy general director of Honda Vietnam, said that two Honda factories in the northern province of Vinh Phuc had to lay off 500 employees in 2013 due to a plunge in motorbike sales.

“In the past, we sold around 20 motorbikes per day right after the Lunar New Year. But that number plummeted to 5 – 6 motorbikes per day following Tet this year,” a Honda salesman in Hanoi said.

Motorbike producers have sold 35-37 million products so far in a market of 90 million people, a Japanese expert was quoted as saying.

The Vietnamese market has almost reached saturation, where supply exceeds demand, the expert added.   

Motorbike sales totaled 2.8 million units last year, down 10 percent from 2012 and 15 percent from a year earlier, statistics show.

The slowdown in motorbike sales in both 2012 and 2013 has shown a trend of exhaustive purchasing power, according to the Vietnam Association of Motorcycle Manufacturers.

Established on August 26, 2013 in the hope of boosting the local market, the association is comprised of Honda Vietnam, Suzuki Vietnam, Yamaha Vietnam, Piaggio Vietnam, and SYM.