Vietnamese pure-play electric vehicle (EV) manufacturer Vinfast has broken ground on a new EV assembly plant in Indonesia at which it hopes to produce 50,000 cars a year.
Vinfast, which made a stunning debut on the Nasdaq stock exchange in August 2023, hopes the strategic move into Indonesia will cement it as a leader in one of south east Asia’s most promising EV markets.
The new assembly plant is located in the emerging industrial hub of Subang, two hours outside of Indonesia’s sprawling capital of Jakarta.
Backed by an initial investment of around $US200 million, the assembly plant will boast an annual capacity of 50,000 vehicles and play host to several key production areas including body shop, general assembly, paint shop, and testing area.
Vinfast expects the new Indonesian assembly plant to begin operations by the end of 2025 and will produce the right-hand drive versions of VinFast’s e-SUV models, including VF 3, VF 5, VF 6 and VF 7 for the Indonesian market.
This bodes particularly well for neighbouring Australia, which Vinfast described in 2022 as “one of its strategic markets”.
“The groundbreaking event, coming just months after VinFast’s official market debut in Indonesia, highlights the company’s strategic expansion and competitive drive in the region, marking a key milestone in our strategy to become a leading player in one of the region’s most promising electric vehicle markets,” said Temmy Wiradjaja, CEO of VinFast Indonesia.
Vinfast recently launched two right-hand drive electric SUV models, the VF 5 and VF e34, in addition to opening dealership stores and introduced flexible sales policies including a battery subscription program.
“We believe this project will demonstrate VinFast’s long-term commitment to Indonesia, boosting the electric vehicle sector, supporting economic growth, and enhancing the quality of life for Indonesian,” said Wiradjaja.
The news came only two days after Vinfast announced that it had delivered 21,747 EVs across the first six months of 2024, an increase of 92 per cent over the first six months of 2023.
Vinfast saw second quarter deliveries hit 12,058, an increase of 24 per cent over the first quarter and 26 per cent over the second quarter of 2023.
Despite what the company described as “encouraging” second quarter delivery numbers, Vinfast nevertheless warned of “ongoing economic headwinds and uncertainties” that is says will require a “more prudent outlook for the rest of the year.”
That being said, Vinfast is still hoping to deliver around 80,000 EVs by year’s end, compared to only 34,855 vehicles delivered in 2023.
The Vietnamese EV maker, which was established in 2017, and finishing its first day of trade on the Nasdaq in 2023 with an eye-popping valuation of $US65 billion, before coming back down to reality.
Vinfast announced late last week that its North Carolina manufacturing facility is now expected to begin production in 2028.
Joshua S. Hill is a Melbourne-based journalist who has been writing about climate change, clean technology, and electric vehicles for over 15 years. He has been reporting on electric vehicles and clean technologies for Renew Economy and The Driven since 2012. His preferred mode of transport is his feet.