Japan motorbike makers to resume Vietnam assembly


HANOI, Nov 6 (Reuters) - Two major Japanese motorcycle makers that had suspended assembly of vehicles in Vietnam due to a shortage of components say they expect to resume production soon following an easing of curbs on imported motorbike parts.

Last Thursday, Hanoi decreed that an extra 185,000 sets of motorbike parts can be brought in this year, nearly two months after it abruptly set curbs on the kits.

The quotas resulted in production suspensions at Vietnam's biggest foreign motorbike assembler, Honda Vietnam, a venture involving Honda Motor Ltd , in mid-Septmber and at Yamaha Motor Co Ltd last month.

Honda said on Wednesday that while it had not set a date for a resumption of assembly, it wanted to start as soon as possible.

The Keizai Shimbun newspaper quoted Honda Vietnam's President Hiroshi Sekiguchi as saying: "I am glad to be able to resume production, but the policy that put foreign firms operating here at a disadvantage is regrettable."

The report said Honda could resume "as early as this week".

Yamaha Vietnam has said it hopes to restart its factories by this week.

Motorcycles are the prime mode of transport in the Southeast Asian country of 80 million, with 10 million in use.

The Japan Automobile Manufacturers Association (JAMA) issued a statement late on Tuesday confirming that Honda, Yamaha and Suzuki Motor Corp had been officially informed about the increase.

"We regret the lateness of the Vietnamese government's response to the situation, but we look favourably upon the likelihood that the makers will be able to restart their plant operations, which had been the biggest concern," the statement from JAMA said.

Suzuki had not halted production, but had said it would be forced to do so soon, if the situation wasn't corrected.

The JAMA delegation failed to resolve the issue in October when it arrived in Hanoi to persuade authorities to ease the curbs. It warned then that such actions could endanger Vietnam's planned entry into the World Trade Organisation.

The controversy was sparked in early September, when Hanoi said it would limit the overall import of motorcycle parts to 1.5 million sets in 2002 versus 1.8 million in 2001. One set or kit makes one motorcycle.

Of the quotas, 600,000 sets were reserved for producers with foreign investment and the balance for roughly 50 local firms.

While communist Vietnam has not specified why it imposed the quotas, it has stressed that foreign companies must abide by their licensing pacts signed with Hanoi, including use of locally made parts, technology transfer and agreed production levels.

It has also cited concerns about the country's unabated traffic accident rate, mostly involving motorcycles.

A Taiwanese motorcycle maker, VMEP, had also been affected by the curbs, but its production is much smaller.



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