December 4, 2023 7:28 PM

EV Market: VinFast Auto, rival to Elon Musk’s Tesla, starts shopping for land in India for EV plant; sees “tremendous potential”

VinFast Auto, a Vietnamese electric vehicle (EV) manufacturer often seen as a rival for Elon Musk’s Tesla, is assessing potential locations for its upcoming manufacturing plant in India. According to an ET report, the company has already reviewed two sites in Tamil Nadu, with land offerings in the Manalur area north of Chennai and in the southernmost district of Tuticorin.Additional site evaluations in Gujarat are also on the horizon, sources told the financial daily.
“VinFast has been keen on Tamil Nadu and Gujarat as it needs a port,” one of the sources was quoted as saying. The selection of Tamil Nadu is advantageous due to the state’s East-West connectivity and the need for a port, the source said.
VinFast recently expressed its intention to establish a manufacturing facility in India. The company is set to invest approximately $200 million and the objective is to commence vehicle assembly by 2026 in a market they have identified as possessing “tremendous potential.”
Earlier, on September 28, ET reported that VinFast was considering Tamil Nadu and Gujarat as potential locations for their manufacturing facility, with ongoing discussions in progress.
In August, following its listing on Nasdaq, VinFast briefly claimed the title of the world’s third-most valuable carmaker. Queries sent to VinFast were unanswered until press time.
Also Read | Nitin Gadkari’s clear message to Elon Musk’s Tesla: “If you make in China, and want to sell it in India…”
During its most recent earnings call with analysts, VinFast revealed its plans to establish a production facility in India by 2026, in addition to Indonesia.
VinFast Auto’s Managing Director and Global CEO, Le Thi Thu Thuy, said on October 5 that each of their new facilities is slated to have an initial annual capacity of up to 50,000 cars, with an estimated investment range of $150-200 million.
Thuy emphasized their intent to tap into the growing electric vehicle (EV) market in both Indonesia and India, where EV adoption remains relatively low. However, specific details about the Indian plant’s location and finer investment aspects were not disclosed.
VinFast’s strategy involves constructing completely-knocked-down (CKD) facilities in Indonesia and India, facilitating access to government incentives for local manufacturing, reduced tariffs and taxes, and cost-effective raw materials.
An informed source regarding the company’s Indian operations has indicated a preference for Tamil Nadu over Gujarat due to better connectivity with East Asian markets, which aligns with VinFast’s interests.
Tamil Nadu boasts three major ports, ranking highest among Indian states in terms of port significance. These ports include Chennai Port, Kamarajar Port near Chennai, and V. O. Chidambaranar Port Authority in Tuticorin.
In April of this year, reports revealed that the Chennai Port Authority (ChPA) and Kamarajar Port Ltd in Ennore collectively exported 380,000 cars during FY23, surpassing the 306,000 units shipped in the previous year. Hyundai Motor and Kia Motors were major contributors to ChPA’s exports during this period.
Founded in 2017, VinFast Auto, the EV arm of Vietnam’s largest private corporation, Vingroup, is set to expand its presence with dealership networks in new market clusters, including India, starting in 2024. Despite being smaller in scale compared to the likes of Tesla, VinFast is aggressively pursuing the electric vehicle market and aims to challenge Tesla’s dominant position in the United States, where the latter commands over 50% of the market.
VinFast currently operates a manufacturing plant in Hai Phong, Vietnam, and has commenced work on its first American factory in North Carolina. Spanning 1,800 acres, the new facility features key production areas for general assembly, bodywork, paint shops, and other manufacturing units, with an anticipated initial annual production capacity of 150,000 vehicles.

Source link

Leave a Comment