VinFast to invest $2 billion for EV manufacturing in Tamil Nadu

Vietnamese EV maker VinFast has chosen the Indian state of Tamil Nadu to set up a 'first-class electric vehicle production hub' in the South Asian region. The construction of the proposed facility with a capacity to build 150,000 cars per year is expected to happen this year. 

At the Tamil Nadu Global Investors Meet 2024 held in Chennai yesterday, the automaker signed an MoU with the state government to work towards a cumulative investment of up to $2 billion, with a commitment of $500 million in the initial phase of project development, spanning five years from the commencement date. 

The company has strategically chosen the coastal town of Thoothukudi in southern Tamil Nadu for the EV plant to leverage the V. O. Chidambaranar Port (formerly Tuticorin Port), one of the three major ports located in the state, which is conducive for seamless EV exports to other Asian and African markets. 

Tran Mai Hoa, Deputy CEO of Sales and Marketing, VinFast Global, commented on the development, "The MoU demonstrates VinFast's strong commitment to the sustainable development and vision of a zero-emission transportation future. We believe that investing in Tamil Nadu will not only bring considerable economic benefits to both parties, but will also help accelerate the green energy transition in India and the region."

Further details on the automaker's manufacturing plans and product strategy for the domestic Indian electric car market is awaited. It is to be noted that VinFast is fast expanding its global market presence, with its Vietnam-made electric cars already on sale in Western markets.

"EV manufacturing companies are not only important economic drivers but also powerful accelerators to the State's green vision. I believe that VinFast will emerge as a reliable economic partner and substantial contributor to Tamil Nadu's long-term development", opined TRB Rajaa, Tamil Nadu's Industries Minister.

Tamil Nadu, with its well-established infrastructure and support ecosystem for manufacturing, is emerging as one of the most sought-after region for EV and battery manufacturing investments in India. The state is already hosting leading EV manufacturers including Ola Electric, Ather, Switch Mobility, Hyundai, and BMW, to name a few.

VinFast's project is claimed as the largest investment in Tamil Nadu's history in the clean mobility space till date. The parties are also said to have agreed to collaborate and discuss opportunities for setting up EV charging and battery manufacturing infrastructure in the state in the coming years.