VinFast may launch locally assembled EVs in India, advances TN plant opening: Report

VinFast, the EV arm of Vietnam's largest conglomerate Vingroup, plans to launch its first locally assembled car during the 2025 festive season.

Vietnamese electric vehicle (EV) maker VinFast is likely to enter the Indian market with locally assembled models following a shift from its initial strategy of selling only imported products.

According to sources cited by The Economic Times, this new approach follows the accelerated opening of VinFast's factory in Tamil Nadu, which is expected to go on stream by first half of 2025.

The EV arm of Vietnam's largest conglomerate Vingroup, plans to launch its first locally assembled car during the 2025 festive season. The vehicles, priced at Rs 25-30 lakh, will target the premium affordable segment of India's growing EV market. The models are expected to offer a range of 300-500 kilometers, according to the ET report.

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Entering the Indian market through the completely knocked down (CKD) route, VinFast aims to avoid high import duties, making its products competitively priced. India imposes a 100 percent import duty on car models with a CIF (cost, insurance, freight) value over $40,000 and 70 percent on models valued under $40,000, whereas CKD kits attract a 15 percent duty.

"The local assembly of models instills greater confidence among suppliers, dealers, and buyers. The savings on duties will be used for brand building and marketing. With the plant expected to be ready in the first quarter of next year, the CKD route is more practical than the completely built unit (CBU) option," a source told ET.

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A VinFast spokesperson did not respond to ET's queries, and Moneycontrol could not independently verify the report. Although VinFast's Indian venture does not rely on the government's new EV policy announced on March 15, the company will closely monitor the guidelines to decide whether to avail the incentives.

The first meeting between EV companies and government officials to discuss the new EV policy was held on April 19. A VinFast representative attended the meeting.

VinFast anticipates that local assembly and competitive pricing will enable it to achieve a peak capacity of 50,000 units in its first year of operations. The company projects that India's nascent electric car market will reach 150,000 units by the end of this year, up from 90,000 units in 2023.

VinFast is expected to disclose its plans for India at the Bharat Mobility Global Expo, scheduled from January 17 to 22, 2025.