Vietnamese electric vehicle (EV) maker VinFast is planning to make a grand entry into India with a huge ₹16,000 crore ($2 billion) investment in Tamil Nadu.
To be launched in June 2025, the new EV factory will help make India a pivotal location in VinFast’s global growth strategy.
With the EV adoption in India growing at a fast pace, Tamil Nadu’s well-established auto ecosystem is the strategic launchpad for the next phase of the company’s growth.
Investment Details and Plant Specifications
VinFast’s new factory will come up on a 400-acre plot in Thoothukudi, Tamil Nadu, and will be constructed in phases. In India, this firm can be said to be the biggest foreign direct investment (FDI) in the sector of EV manufacturing sector.
The firm will be investing a whopping $500 million, which is around ₹4,000 crore, in the next five years for the initial phase. It is said that the firm will be producing up to 150,000 electric cars annually and will generate 3,000 to 3,500 direct and indirect employment opportunities.
This will also support Tamil Nadu’s goal of becoming the top production centre of EVs in the country.
VinFast’s Global Strategy and Shift to Asia
Having experienced delivery issues and losing steam in the U.S. market, VinFast is shifting its attention to Asia, with India and Indonesia being target markets.
VinFast is scheduled to open its Indonesian EV factory by October 2025, which marks a wider regional play. It is targeting sales of about 200,000 vehicles worldwide in 2025, with Asia set to account for much of that, according to Reuters.
This strategic pivot allows VinFast to avoid global supply chain volatility, minimise tariffs, and benefit from increasingly burgeoning EV demand in the emerging economies, particularly India, the world’s third-largest auto market.
Product Portfolio and Market Entry Plans
The company will now be launching its electric SUVs VF6 and VF7 in India, targeting the fusion of aesthetics, power, and eco-friendliness for Indian consumers. VinFast is aiming to strengthen its position by setting up comprehensive dealership and service networks in major Indian metropolitan areas.
According to The Hindu BusinessLine, VinFast has also made an application for a temporary reduction in import duties to make the first imports of vehicles competitive while its local production builds up in the period after June 2025.
Economic and Environmental Impact
VinFast’s EV factory will dramatically contribute to the Tamil Nadu economy through employment, infrastructure growth, and green technology skill development.
It supports the Indian government’s vision of achieving 30% EV penetration by 2030 and Tamil Nadu’s vision of becoming a world EV hub. Localising production will also decrease carbon emissions linked to imports, supporting India’s overall climate action under the Paris Agreement.
While Tesla is said to be planning an India EV plant costing $2–$3 billion, VinFast’s being an early bird might prove the determining factor to secure market share.
By regionalising production and dovetailing with India’s vision for green mobility, VinFast becomes a force to reckon with in India’s changing EV scene. By bringing its offerings to market and expanding operations, VinFast could remake India’s EV market and help drive India toward sustainable electric mobility.
