VinFast, Tesla’s rival, plans to open a car assembly plant in India by the end of June
VinFast, Tesla’s rival, plans to open a car assembly plant in India by the end of June
VinFast, still running at a loss, had earlier focused on expansion in America. But with slow development in the United States and more uncertainties over U.S. tariffs, the company has shifted its strategy, a Reuters report says.
"Shortly, aside from the Vietnamese market, we will pay more attention to Indonesia, India, and the Philippines markets," Pham Nhat Vuong told Vingroup shareholders.
"Currently, VinFast is not going to increase sales in the United States, Canada, and the European Union because of high logistics fees," he added.
VinFast signed a deal with the state of Tamil Nadu last year, planning an investment of as much as $2 billion. The first five-year commitment is worth $500 million, with the factory set to manufacture up to 150,000 vehicles a year.
While Tesla, led by Elon Musk, also views India as a very appealing market, but has been concerned with the 100% import duties on cars, which make the purchase hesitant for prospects. CFO Vaibhav Taneja says the firm is still looking at the right time to make its entry into the Indian market.
The US electric vehicle maker has long been keen to set up shop in India, the world's third-largest automotive market. However, the high import tariffs, which CEO Elon Musk recognizes as some of the highest in the world, remain a significant hurdle.
VinFast's move to set up a car assembly factory in India by June is a turning point in the company's international strategy, reflecting its expanding ambitions in Asia as Western markets become challenging. By investing in countries such as India and Indonesia, VinFast hopes to build its presence where demand for electric cars is increasing and production is affordable. At the same time, Tesla is still weighing its foray into India, carefully maneuvering the steep import duties of the country. With competition in the EV space increasing, the coming months will prove pivotal in defining the regional hegemony of these international players.
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