How VinFast Accelerates Its Global Reach in the Electric Vehicle Market
The Vietnamese automaker VinFast, is rapidly evolving into a significant player in the global electric vehicle (EV) market, with ambitious plans and strategic developments marking its journey. Established in 2017, VinFast has made remarkable progress in the automotive industry, starting with its state-of-the-art manufacturing complex in Hai Phong, Vietnam, that runs on 90% automation. The facility, with an annual capacity of 5 gigawatt-hours (equivalent to 30 million battery cells), broke ground on an 828-acre space on Cat Hai Island near Hai Phong, and was built in just 21 months. The initial investment of US$1.5 billion with more to follow, sets the stage for the production of passenger vehicles, electric buses, and electric motorbikes. With talent from established companies and partnerships with European designers and engineers, VinFast showcased its first two vehicles, the LUX SA2.0 and the LUX A2.0, at the Paris Motor Show in 2018, setting a production estimate of 950,000 vehicles per year by 2026.
VinFast’s Expansion into the EV Market
North America
VinFast’s international expansion doesn’t stop in Asia. The company has confirmed the commencement of construction for its EV factory in North Carolina, set to produce up to 150,000 vehicles annually in its first phase. The construction, supported by a $1.2 billion funding from the state of North Carolina, is set on a vast 728-hectare area. The plant will primarily produce electric vehicles for the North American market. The facility will also include battery assembly and spaces for supplier companies, although specific details about these suppliers have not been disclosed. The battery manufacturing plant for VinFast’s facility in North Carolina is set to be built alongside the electric vehicle assembly plant. VinFast has selected North Carolina for its first North American automotive assembly and battery manufacturing plant. The company intends to create a comprehensive manufacturing site that will produce electric vehicles, electric buses, and batteries for them, with batteries to be locally produced here. The start of operations for the plant was initially planned for July 2024 but was later postponed to 2025. With operations beginning in 2025, VinFast aims to tap into the U.S. market’s potential, anticipating the shift to electric vehicles. Vehicles to be produced at the facility include the VinFast VF 9, a 7-passenger all-electric Sport Utility Vehicle (SUV) and the VinFast VF 8, a 5-passenger, all-electric mid-size SUV.
India
In a strategic move to further its global presence, VinFast announced plans to invest up to $2 billion in India producing EV batteries, aiming to establish a comprehensive EV manufacturing hub in Tamil Nadu. This venture is a significant upscale from its initial plans, with the factory expected to produce 150,000 EVs annually and employ 3,000 to 3,500 people, focusing on gender equality and career advancement. The Tamil Nadu project is anticipated to evolve into a first-class EV production hub, complementing the company’s main plant in Vietnam by tapping into Indonesia’s rich nickel resources crucial for battery production.
Indonesia
Indonesian President Joko Widodo has approved VinFast’s expansion into Indonesia. The announcement came after his visit to VinFast’s facility in Vietnam, aligning with the company’s plan to invest US$1.2 billion in Indonesia. This includes US$200 million for an EV manufacturing plant in Bekasi, West Java, aiming for a 30,000 to 50,000 annual production capacity by 2026. It will produce city car models and the Vinfast VF 5 crossover and Vinfast e34, priced from Rp 250 million to Rp 300 million. VinFast, under Vingroup, is collaborating with Indonesia’s Gojek, which belongs to GoTo Group, to promote EV usage and plans to invest up to US$900 million through its ride-hailing arm – Green and Smart Mobility (GSM). The commitment from the Tamil Nadu government includes clearing land to facilitate manufacturing, consistent power supply, and ancillary infrastructural support.
Overall, Vinfast is establishing a major EV production network with a flagship plant in Vietnam and new investments in North America, India, and Indonesia. The company’s $4 billion North Carolina plant and a $2 billion facility in Tamil Nadu will each produce up to 150,000 vehicles annually, while a $1.2 billion investment in Indonesia complements its Southeast Asian operations.
Strategic Partnerships and Technological Innovations
VinFast and Renesas have entered into a strategic partnership focusing on the development of automotive technology for electric vehicles. This collaboration aims to drive the global smart electric vehicle revolution, leveraging VinFast’s state-of-the-art automotive manufacturing complex in Hai Phong, Vietnam, and Renesas’s expertise in microcontrollers and semiconductor solutions. The company has partnered with worldwide automotive suppliers to design, engineer, and manufacture its first two cars, a sedan and an SUV. More than 400 engineers from Magna Steyr are involved in the project, working on integrating vehicle systems, Bosch ECU technologies, and new electric and electronics architecture. AVL is engineering a turbocharged 2.0-liter inline four-cylinder gasoline engine for these vehicles. VinFast is integrating VinES into its operations, a company specializing in R&D and production of lithium-ion batteries for mobility and energy storage applications. VinES collaborates with partners like the Israeli battery developer StoreDot and the Chinese battery manufacturer Gotion High-Tech. This merger is expected to significantly bolster VinFast’s competitive edge in the global electric vehicle market by controlling the battery technology and supply chain. VinFast has leveraged Siemens’ comprehensive portfolio of integrated software and hardware to accelerate its car production. Using Siemens’ Digital Enterprise portfolio, including the Xcelerator portfolio of software and Totally Integrated Automation (TIA), VinFast has created accurate digital twins of its cars and production processes.
