VinFast Launches EV Production in India with $500 Million Tamil Nadu Plant

Vietnamese electric vehicle manufacturer VinFast has commenced production at its first overseas EV plant in Thoothukudi, Tamil Nadu, marking a significant milestone in the company’s global expansion strategy. 

The newly inaugurated facility is part of a planned USD 2 billion investment in India, with USD 500 million committed over the next five years in collaboration with the Tamil Nadu government.

The factory has an initial production capacity of 50,000 electric vehicles per year, scalable to 150,000 units, and will produce two premium SUV models, the VF 7 and VF 6, for the Indian and export markets. 

“The India plant is not just a manufacturing site but a strategic hub for South Asian exports,” VinFast said in a statement. The company selected Tamil Nadu after scouting 15 locations across six Indian states, citing the state’s industrial ecosystem and port access as key advantages.

A Strategic Pivot Toward Asia

After facing limited success in North America and Europe, VinFast is betting big on Asia. The Indian market - one of the major automotive markets globally - represents a critical opportunity for the Vietnamese automaker to scale its operations and meet its global delivery target of 200,000 vehicles in 2025.

In the first half of 2025, the company delivered around 72,100 vehicles, mostly within Vietnam. It sold nearly 97,000 vehicles in 2024, up from 32,000 in 2023, although only 10 percent were outside its home market.

Export Potential

The Thoothukudi facility is expected to eventually become a launchpad for exports to the Middle East, Africa, and wider South Asia. Its proximity to major ports gives it an edge in logistics and international trade.

In addition to manufacturing, VinFast plans to expand its electric ride-hailing services and other verticals into India. The company has also broken ground on a USD 200 million EV assembly plant in Indonesia, with production slated to begin by year-end. A similar expansion is underway in Thailand and the Philippines.

US Expansion Delayed, Focus on Asia Intensifies

While Asian markets gain priority, VinFast has delayed its US production plans to 2028, reflecting a strategic reorientation. The company is backed by Vietnam’s largest conglomerate, Vingroup, and aims to strengthen its position through regional presence and local partnerships.