- VinFast, electric vehicle (EV) maker from Vietnam, has declared its plans to establish its initial EV facilities in India, targeting the world’s third-largest automobile market.
- The EV producer has partnered with the state of Tamil Nadu for a potential $2 billion investment. The initial five years will see a $500 million commitment to initiate the project.
- With regards to the creation of local jobs, the construction of EV and manufacturing plants might create between 3,000 to 3,500 positions.
- The goal for VinFast is to turn the Tamil Nadu project into a leading EV production center, forecasting an annual capacity of approximately 150,000 vehicles.
- The electric vehicle sector in India, which currently makes up around 2% of total car sales, is expected to rise to 30% by 2030 according to government plans.
Vietnam’s VinFast Targets Indian EV Market
Electric vehicle manufacturer VinFast from Vietnam announced on Saturday its plans to set up its debut EV facilities in India. The move is seen as a strategic bid to tap into the third largest automotive market in the world.
Strategic Partnership with Tamil Nadu
The EV maker has entered into an agreement with the state of Tamil Nadu in southern India, anticipating a collective investment of $2 billion. The firm committed to invest $500 million in the first five years to get the project off the ground, as stated in their joint press release.
Job Creation and Expected Launch Timelines
The construction of the EV and production facilities is expected to begin later in the year. The upcoming project is estimated to create about 3,000 to 3,500 employment opportunities locally, as per the statement.
VinFast looks forward to the Tamil Nadu enterprise becoming a prominent EV manufacturing hub in the region. VinFast expects the production capacity to reach up to 150,000 vehicles per year, slightly lower than the 250,000 vehicles produced in its main Vietnamese plant. Despite EV sales in India being just 2% last year, with government efforts, these figures are expected to increase to 30% by 2030. As indicated in the statement, the Tamil Nadu state government has committed to providing cleared land and essential infrastructure support to the manufacturing facilities, including a steady power supply. Shares of VFS have seen a slight decrease of 1.14% in early Monday trading.
In perspective, if India successfully boosts the EV sector to 30% by 2030, the demand for electric cars and their ensuing sales will steeply rise, thus potentially impacting forex trading and asset markets. It’s worth monitoring the trade of VFS shares, given that the company’s stocks slightly dipped in the wake of the project announcement.