Vietnam EV maker VinFast to invest up to $2 bn in India facility

Vietnamese electric vehicle maker VinFast has announced plans to invest up to $2 billion for setting up an integrated manufacturing facility in India, as it looks to tap the world’s third largest market for automobiles. 

The company has signed a memorandum of understanding (MoU) with the Tamil Nadu government for setting up a plant in Thoothukudi, with an annual capacity of 1,50,000 units.

VinFast plans to make initial investment of $500 million for up to five years, expanding it further depending on the growth of business. The EV maker’s main plant in Vietnam has an annual manufacturing capacity of 2,50,000 units.

Construction of the plant is targeted to start this year. The project will generate 3,000 direct employment and create 35,000 jobs indirectly.

Tamil Nadu, a major destination for automobile companies setting up base in India. Prominent companies such as BMW, Hyundai, and Renault-Nissan, as also electric vehicle manufacturers including BYD from China and India-based Ather Energy and Ola Electric have set up manufacturing facilities in the state.

“We are delighted that VinFast has chosen to invest in Tamil Nadu to establish its integrated EV facility. Possessing robust capabilities and unwavering commitment to a sustainable future, I believe that VinFast will emerge as a reliable economic partner and substantial contributor to Tamil Nadu’s long-term development,” Tamil Nadu minister of industries Thallikotai Raju Balu Rajaa stated after the signing of the MoU.

VinFast is looking to develop a pan-India dealership network to reach the final consumer.

“We believe that investing in Tamil Nadu will not only bring considerable economic benefits to both parties but will also help accelerate the green energy transition in India and the region,” deputy CEO of sales and marketing at VinFast Global, Tran Mai Hoa, said.

Established in 2017 in Haiphong by the Vingroup, VinFast Auto Ltd has grown into a multinational automotive company. It is also the first Vietnamese company to manufacture electric vehicles and expand into global markets.