Vietnamese EV Maker VinFast to Launch Locally Assembled Vehicles In India
VinFast, the electric vehicle (EV) arm of Vietnam’s largest conglomerate Vingroup, is set to enter the Indian market with locally assembled car models, moving away from its initial strategy of selling only imported products. This shift is in line with the company’s accelerated plans for establishing a strong presence in India’s burgeoning EV sector.
Tamil Nadu Plant Opening Ahead of Schedule
VinFast has made significant progress on its first Indian manufacturing facility in Tamil Nadu. Originally slated to open in the latter half of 2025, the plant is now expected to be operational by March 2025, three months ahead of schedule. This rapid development underscores VinFast’s commitment to the Indian market.
Strategic Investment and Production Capacity
The construction of the Tamil Nadu facility follows an agreement with the state government to invest US$2 billion, with an initial investment of US$500 million over five years. Once completed, the plant is projected to produce 150,000 EVs annually and employ between 3,000 to 3,500 local residents. This facility will operate under the completely knocked down (CKD) mode, enabling VinFast to bypass high import duties and offer competitive pricing.
First Locally Assembled EVs Set for 2025 Festive Season
VinFast plans to launch its first locally assembled EVs during the 2025 festive season. These vehicles, priced between INR 2.5 to 3 million, will target the premium affordable segment of India’s growing EV market. They are expected to offer a driving range of 300-500 kilometers, providing a balance of affordability and performance.
Global Expansion Amid Financial Challenges
VinFast’s Indian expansion is part of a broader strategy that includes establishing manufacturing plants in Indonesia and a $2 billion complex in North Carolina. Despite reporting a net loss of $2.395 billion in 2023—a 14.7% increase from 2022—the company saw its total revenue rise to $1.198 billion, marking a 91% increase compared to the previous year.
Future Prospects and Localization Efforts
Frost & Sullivan predict substantial localization of essential EV components in India by 2030, driven by rapid EV adoption and supportive incentive policies. However, achieving complete localization of the EV supply chain may face challenges due to the scarcity of specific rare earth minerals necessary for production.
