Vietnamese electric vehicle manufacturer VinFast has announced a $500 million investment over five years to construct a car and battery manufacturing facility in Tamil Nadu, India. The plant, currently under construction in Thoothukudi, is expected to be completed by the second half of 2025. It will have an initial production capacity of 50,000 vehicles annually, with the potential to scale up to 150,000 units based on market demand.
VinFast’s expansion into India includes the introduction of two electric SUVs, the VF 6 and VF 7, unveiled at the India Auto Show in New Delhi. The company is in the process of appointing dealers across major Indian cities and is exploring investments in charging infrastructure to support its vehicles.
The Indian government has set a target for electric vehicles to comprise 30% of total car sales by 2030, up from approximately 2.5% of over 4 million vehicles sold last year. To facilitate early market entry before the factory becomes operational, VinFast is seeking a reduction in India’s 100% import tax on fully built EVs, a move that has faced opposition from domestic automakers.
This investment aligns with VinFast’s strategy to expand beyond its primary markets in North America and Vietnam, despite reporting increased losses due to a global softening in EV demand. The company aims to contribute to India’s net-zero carbon emission goals through its electric vehicle offerings.