VinFast to Invest $500 Million in Tamil Nadu Plant Expansion for Electric Bus and E-Scooter Production

VinFast on Thursday revealed plans to expand its manufacturing footprint in Tamil Nadu through a new Memorandum of Understanding (MoU) with the state government. The arrangement will allot roughly 200 hectares of land neighbouring the firm's current facility within the SIPCOT Industrial Park in Thoothukudi. The expansion constitutes the second phase of VinFast's $2 billion pledge to India and will witness the Vietnamese EV maker invest $500 million to create dedicated production facilities for electric buses and e-scooters. The new installations will include manufacturing, assembly, testing, and associated operations for these vehicle segments.

Also read: Vietnam’s VinGroup Plans Taxi Service in India, Driver-Salesman Model To Scale Up Volume

VinFast's present Thoothukudi facility extends across 160 hectares and incorporates internationally standardised production lines with an initial annual capacity of 50,000 electric vehicles. The organisation is presently augmenting this capacity to 150,000 units.

As part of the arrangement, the Tamil Nadu government will furnish assistance in obtaining requisite permits and creating infrastructure connections including electricity, water, road access, drainage, and waste management systems. 

Also read: From Scooters to Buses, VinFast Plans Full Spectrum Mobility Play in India

The state will also implement applicable incentives, financial support measures, and statutory exemptions according to existing regulations.

“The proposed expansion of the Tamil Nadu plant will enable us to broaden our product lineup in India, from electric cars to electric buses and e-scooters, allowing us to meet a wider range of customer needs. We also expect this initiative to create new job opportunities, advance localization and strengthen the skills of the local workforce. VinFast believes that Tamil Nadu will continue to serve as a strategic hub in our global expansion journey and will play an important role in supporting India’s green mobility goals in the years ahead," Pham Sanh Chau, Vingroup Asia CEO and VinFast Asia CEO, said in a statement.

“We welcome VinFast’s next phase of planned development of the electric cars in Tamil Nadu and the new introduction of electric bus and e-scooters production will generate additional momentum for the green transportation strategy of both Tamil Nadu and India. The state government is committed to working closely with VinFast and ensuring favourable conditions throughout the implementation process to deliver lasting benefits for the community and the regional economy by ensuring that Vingroup thrives in Tamil Nadu and their flourishing ecosystem provides jobs for Tamil Nadu," said TRB Rajaa, Minister of Industries of the Government of Tamil Nadu.

Since establishing operations in the Indian market, VinFast has been setting up a comprehensive EV ecosystem spanning manufacturing, distribution, charging infrastructure, after-sales services, and battery recycling. The enterprise currently maintains 24 dealerships across major Indian cities and targets reaching 35 by year-end.