VinFast Announces Plans to Establish EV Manufacturing Facilities in India with a $2 Billion Investment

VinFast, the Vietnamese electric vehicle (EV) manufacturer, has inked a significant agreement to inaugurate its maiden manufacturing units in India, targeting the vast potential of the world's third-largest automobile market.

In collaboration with the southern state of Tamil Nadu, the company is poised to channel investments that could soar up to $2 billion, with an initial commitment of $500 million earmarked for the project's inaugural five years, as per an official joint statement.

The venture is slated to kick off construction on its EV and battery production plants within the current year, anticipating the creation of a substantial 3,000 to 3,500 employment opportunities in the local sector, the statement further elaborated.

Recent reports from Reuters had hinted at VinFast's strategic decision to inaugurate its primary manufacturing facility in the Thoothukudi district of Tamil Nadu, focusing primarily on the production of EV batteries.

Established in 2017, VinFast commenced its foray into the EV industry in 2021 and has since unveiled an array of expansion strategies targeting international markets.

Following its landmark debut on the Nasdaq in August, the company divulged its aspirations for an expansive footprint in India just a month later.

Tamil Nadu's capital city, Chennai, often dubbed as the 'Detroit of Asia,' along with its adjoining districts, has emerged as a burgeoning hub for EV manufacturers, hosting industry stalwarts like Indian electric two-wheeler giants Ola Electric and Ather, in addition to China's prominent player BYD (002594.SZ).

VinFast envisions the Tamil Nadu initiative to burgeon into a premier EV production nucleus within the region, boasting an annual manufacturing capacity potentially reaching 150,000 vehicles.

This ambitious target, however, remains a fraction compared to the mammoth 250,000-vehicle capacity operational at its primary manufacturing hub in Vietnam.

The joint statement refrained from delineating the projected capacity for the forthcoming battery facility.

Phuong Nguyen / Reuters