Vietnam’s lubricants market is being reshaped by rapid growth in passenger vehicles, electric vehicles and industrial activity, while motorcycles remain the dominant form of transportation, according to speakers at a recent ICIS conference in Singapore.
“Vietnam is not one lubricant market. It is four markets moving at different speeds,” an industry insider told attendees, describing the four segments as motorcycles, passenger vehicles, electrification and industrial.
Motorcycles remain the main mode of transportation, with about 518 motorcycles per 1,000 people compared with 22 passenger cars per 1,000 people. “Motorcycles are part of their life. It is their child. It is their baby and they will park their motorcycle next to their couch,” said Charlotte Kehoe, Asia-Pacific technology director at bp Castrol.
The passenger vehicle market is growing as Vietnam also introduces incentives for electric vehicles (EVs). Kehoe said Vietnam’s transition to EVs is advancing faster than in other Association of Southeast Asian Nations (ASEAN) markets, calling it “a significant signal.”
“It is an industrial policy mission,” she said. VinFast is a major force in Vietnam’s EV market, with a 70% to 75% share, while EV sales grew 84% year on year in 2024, according to Kehoe.
“It is not just a transport story. It is more of a story of overlapping industries,” she said, adding that she expects EVs and internal combustion engine (ICE) vehicles to continue to coexist.
EVs accounted for about 33% of all vehicle sales in Vietnam in the third quarter of 2025, almost twice the ASEAN average of 17%.
Vietnam’s broader economic growth is also supporting industrial activity. According to the World Bank, the country’s gross domestic product grew about 8% in 2025. Electronics was Vietnam’s largest export sector, with exports reaching $107.8 billion.
The country is also developing into a regional manufacturing and export hub as factories move further up the value chain, Kehoe said.
“Vietnam is no longer a motorcycle market,” she said. “Passenger vehicles are growing and Group I base oil is still important for the industrial spaces which are growing.”