Vietnamese automaker VinFast has announced plans to invest $4 billion in a new electric vehicle (EV) factory in the United States. The factory will produce 150,000 EVs per year, as well as batteries and buses.
Construction is expected to begin later this year, pending the necessary permits. This new factory will join VinFast’s existing manufacturing plants in Vietnam, which produce cars, motorbikes, and scooters.
“With a manufacturing facility right in the US market, VinFast can stabilize prices and shorten product delivery time, making our EVs more accessible to customers,” said Nguyen Thi Thu Thuy, Vingroup vice chair and VinFast Global CEO.
This new factory will create 7,000 jobs, making it the largest economic development announcement in the state of North Carolina’s history. VinFast is hoping to compete with legacy automakers and startups with affordable electric SUVs and a battery leasing model.
“North Carolina is quickly becoming the center of our country’s emerging, clean energy economy,” said North Carolina Governor Roy Cooper. “VinFast’s transformative project will bring many good jobs to our state, along with a healthier environment as more electric vehicles take to the road to help us reduce greenhouse gas emissions.”
The move comes as electric vehicles are becoming increasingly popular, with many countries around the world investing in their own production capacity.
China, the world’s largest electric vehicle market, is investing billions in new electric vehicle factories. Thailand car manufacturers are also taking advantage of the country’s tax breaks and subsidies for EV production.
On the other hand, US manufacturers have been slower to adopt electric vehicles. But that is changing. In January, General Motors announced plans to invest nearly $7 billion in its own electric vehicle production. Other companies, such as Ford and Siemens, have also announced plans to invest in electric vehicles.
Prices for VinFast’s VF8 sport SUV start from $41,000 in the United States. Tesla’s SUV sells for around $63,000. VinFast is targeting global electric vehicle sales of 42,000 this year.
As early as May 2021, VinFast expressed plans for a US listing with a $60 billion valuation. The company ranked fifth in Vietnam in terms of market share as of 2021.
Outside of the US, VinFast is also planning to enter the European market this year. The company will invest in electric vehicle factories in Germany, France, and the Netherlands.
In 2019, VinFast became Vietnam’s first fully-fledged domestic car manufacturer, producing cars, motorbikes, and scooters. The company is hoping to capitalize on the global trend towards electric vehicles and transition to electric vehicle production from late 2022.