VinFast, a subsidiary of Vingroup JSC, Vietnam’s largest conglomerate and electric vehicle (EV) manufacturer, announced its first EVs for the Indian market—without disclosing prices—at January’s Bharat Mobility Global Expo in New Delhi.
Nasdaq-listed VinFast introduced two made-in-India premium sports utility vehicles, the VF 6 and VF 7, as its first models for the world’s third-biggest car market. India is also the first market for which VinFast has developed a right-hand drive version.
EVs comprised about 2.5% of the 4 million-plus vehicle sales in India last year. As the third-largest greenhouse gas emitter, the country is encouraging global EV manufacturers to produce locally. The government aims for EVs to account for 30% of vehicle sales by 2030 and targets carbon net zero by 2070. Although high prices and insufficient charging infrastructure remain a challenge, the Indian EV market is projected to grow from $3.2 billion in 2022 to approximately $22 billion by 2029, making it the largest market in the world by 2030.
To take advantage, many global automotive companies are preparing to begin production in India, with VinFast the latest entrant. Established manufacturers such as Mahindra & Mahindra, Maruti Suzuki India, Tata Motors, and China’s BYD Company are already producing EVs there.
VinFast is investing $500 million in a car-and-battery factory in Tamil Nadu, aiming for an initial capacity of 50,000 EVs annually. The company plans to establish charging infrastructure and start production in the second half of this year, when sales are set to begin.
The Vietnamese company is hoping that its Indian incursion will help it regain momentum after losing money since its US launch in late 2022. By expanding its global distribution and dealership network and boosting manufacturing in key cost-effective markets across North America, Europe, and Asia, it aims to compete with established automakers and affordable Chinese EVs.
Timing may be tricky, however. VinFast has requested the Indian government reduce the 100% import tax on fully built EVs so that it can launch sales while its factory is being established. Domestic automakers oppose the request.
