VinFast to Establish New Assembly Plants in India and Indonesia in 2023
VinFast plans to open assembly plants in India and Indonesia in 2023 as part of a strategic shift towards Asian markets, moving away from its prior focus on the U.S. due to slow progress and logistical challenges.
VinFast, a Vietnamese electric vehicle manufacturer, is set to establish a car assembly plant in India by the end of June 2023 and another in Indonesia by October 2023, reflecting its strategic pivot towards the Asian market. This shift comes after the company initially focused on the U.S. market, but slower progress and concerns over U.S. tariffs prompted a change in direction.
The company’s chairman, Pham Nhat Vuong, indicated that VinFast will concentrate efforts on expanding in Indonesia, India, and the Philippines, distancing from the U.S., Canada, and European markets due to high logistics costs. VinFast had previously agreed with the Tamil Nadu state in India to invest up to $2 billion, committing $500 million over the first five years to facilitate the new plant’s development.
The upcoming Indian facility is projected to yield an annual production capacity of 150,000 vehicles. Furthermore, the assembly factory in Indonesia, which was announced last year and began construction in July, is expected to become operational by the stated October deadline, solidifying VinFast’s commitment to the Asian automotive market.
In summary, VinFast’s strategic shift towards establishing assembly plants in India and Indonesia signifies its growing focus on the Asian market following challenges in the U.S. This transition involves significant investments, with a focus on increasing production capacity and avoiding the high logistics costs associated with exporting to Western markets. The developments reflect a calculated pivot that aligns VinFast with emerging markets in Asia.
Original Source: www.tradingview.com
