Vietnamese automotive firm VinFast, a division of Vingroup, is poised to enter the Indian electric vehicle (EV) market with locally assembled cars, according to a new report from ET Auto. Initially contemplating the importation of Completely Built Units (CBUs), VinFast now plans to capitalize on cost efficiencies by assembling Completely Knocked Down (CKD) kits within India. This strategic shift aims to mitigate steep tariff rates imposed by the Indian government, which can reach up to 100% for CBUs, reducing significantly to 15% for CKD kits.
VinFast’s decision to assemble locally underscores its commitment to the Indian market and its local partners, allowing for more competitive pricing and better market penetration. The company anticipates commencing operations at its forthcoming factory in Thoothukudi, Tamil Nadu, ahead of schedule, enhancing its production capabilities to meet domestic demand as well as export requirements to South Asia, the Middle East, and Africa.
According to sources cited in the report, VinFast plans to launch EV models with a range of 300-500 km at prices ranging from ₹2.5-3.0 million (approximately €28,000-33,000), potentially positioning them in a higher price bracket than the average Indian consumer typically targets. Future plans may include full-scale manufacturing in India to further reduce costs and align with local pricing expectations.
VinFast’s upcoming factory, strategically located near the V. O. Chidambaranar Port, is expected to have an annual capacity of up to 150,000 units, supporting the company’s ambitious growth plans in the region. The first locally assembled VinFast cars are slated for launch during India’s festive season in 2025, marking a significant milestone in the company’s expansion strategy.
While VinFast considers leveraging Indian government incentives aimed at reducing customs duties on high-value CBUs, it remains open to exploring this option for future models, contingent upon meeting specified investment thresholds in local EV production.
VinFast, established in 2017 and renowned for its diverse lineup of seven EVs in Vietnam, including SUVs ranging from the compact VF 3 to the full-size VF 9, continues to navigate regulatory landscapes and market dynamics as it prepares to enter India’s burgeoning EV sector.
