VinFast, the Vietnamese electric vehicle (EV) giant, has announced a deal to set up its first production facilities in India, aiming to conquer the world’s third-largest vehicle market.
In a joint statement, VinFast and the southern state of Tamil Nadu confirmed their collaboration towards a substantial investment of up to $2 billion, earmarking $500 million for the project’s initial five years.
Anticipated to commence this year, the construction of EV and battery manufacturing plants under this venture is projected to create 3,000 to 3,500 employment opportunities within the local landscape, as highlighted in the statement.
Reports from Reuters earlier indicated that VinFast would inaugurate its primary Indian manufacturing hub in Thoothukudi, Tamil Nadu, emphasizing the production of EV batteries.
Founded in 2017 and venturing into EV manufacturing since 2021, VinFast has been vocal about its global expansion strategies. The company made its debut on Nasdaq in August, subsequently revealing intentions for expansion into the Indian market a month later.
Tamil Nadu’s capital, Chennai, along with various districts, is already home to several prominent EV players, including Ola Electric and Ather from India, along with China’s BYD.
VinFast outlined the Tamil Nadu project as a potential cornerstone for EV production in the area, boasting an estimated annual capacity of up to 150,000 vehicles, in contrast to its primary facility in Vietnam, capable of producing 250,000 vehicles. The joint statement, however, remained mum on the specific capacity of the proposed battery facility, Reuters news report said.
Despite electric models contributing a mere 2 percent to India’s total car sales last year, the national government is steadfast on its goal to escalate this figure to 30 percent by 2030, actively devising strategies to allure more EV manufacturers.
The commitment from the Tamil Nadu government includes provisions for cleared land to facilitate manufacturing, consistent power supply, and ancillary infrastructural support, as articulated in the joint statement.
VinFast also revealed plans to establish a widespread network of dealerships across the country.
Moreover, VinFast’s achievements in 2023 were marked by significant milestones, including the delivery of 9,535 electric vehicles in the second quarter, a five-fold increase from the preceding quarter. The EV company reported a global delivery of 11,315 electric vehicles in the first half of 2023.
In another significant development, VinFast commenced construction at its electric vehicle manufacturing site in Chatham County, North Carolina, on July 28, 2023. This facility is projected to kickstart production in 2025, fostering a network of suppliers and generating thousands of job opportunities.
This manufacturing complex in North Carolina stands as VinFast’s inaugural electric vehicle factory outside its home ground in Vietnam.
Meanwhile, VinFast on Saturday named its founder and biggest financial backer, Pham Nhat Vuong, as chief executive officer as it plans an ambitious overseas expansion and ramps up sales via dealerships.
Pham Nhat Vuong, 55, replaces Le Thi Thu Thuy, who had held the post since late 2021, VinFast said in a statement. Le Thi Thu Thuy, a finance expert, will serve as chairwoman and lead engagement with external stakeholders.
Vuong, also the founder and chairman of Vingroup – Vietnam’s biggest conglomerate and VinFast’s parent company – will directly oversee the EV maker’s operations, including global production, sales and marketing, the company said.
He will be VinFast’s fourth chief executive. Previous CEOs include General Motors veteran James Deluca and Michael Lohscheller, who came from Opel and Volkswagen.