VinFast explores acquisition of Ford's Chennai factory for India debut
What's the story
Vietnamese electric vehicle (EV) maker VinFast is eyeing Ford's factory in Chennai, India, as part of its global expansion plans, Autocar has reported.
Established in 2017 by Vingroup, VinFast initially collaborated with General Motors and BMW to produce and sell cars in Vietnam.
The company has since pivoted to electric vehicles and is exploring markets such as India, Indonesia, and other ASEAN regions to launch its EV line-up.
Details
VinFast's EV line-up and global expansion
In 2021, VinFast debuted the VF 8 electric SUV in the US, followed by the VF 9, a three-row car.
Despite modest initial sales, VinFast is constructing an EV factory in the US and plans to assemble EVs in Indonesia starting in 2026.
The company has already started hiring for positions in India and aims to start operations next year through the Completely Built-Up (CBU) route, followed by local assembly using Completely Knocked-Down (CKD) kits.
What Next?
Ford plant acquisition: A win-win situation
Acquiring Ford's Chennai factory could be a win-win situation for both companies.
Ford India's Chennai plant has a capacity of 2.1 lakh units, while VinFast is seeking a smaller capacity due to India's still-developing EV market.
The acquisition would likely be more cost-effective than investing in a greenfield facility, making it an appealing option for VinFast.
For Ford, selling the factory would signify a complete manufacturing exit from India.
Insights
VinFast's top-down approach for India
Insiders indicate that VinFast will likely adopt a top-down approach, starting with CBU units and CKD kits before transitioning to local manufacturing later this decade.
The company has made an initial inquiry for Ford's Chennai facility, and talks may be in the early stages.
Using India as a base for right-hand drive markets, VinFast plans to produce vehicles for both domestic and export markets in the second half of this decade.