VinFast will add a second factory in Vietnam to handle anticipated demand for its small and midsized products. The new facility is expected to begin production by July 2025. The move comes even as it delays construction of a U.S. assembly plant.
The new plant is expected to produce some of VinFast’s smaller EVs. The VF6 is shown here.
Even though it has fallen short of its sales targets for the year, VinFast is forecasting significant growth ahead — enough for it to justify adding a second assembly plant alongside its original factory alongside Vietnam’s Haiphong harbor.
The new plant will produce a variety of new small and midsize models, such as the VF3 and VF5 battery-electric crossovers.
In keeping with the company’s name — and operating style — VinFast expects to have the new factory up and running next July.
Growing demand — or so it hopes
So far, VinFast sales for products like this VF8 have fallen short of target.
The new factory is expected to cost around $288 million, according to the Vietnamese automaker. And it will have a capacity to produce as many as 300,000 battery-electric vehicles annually.
“Demand in international markets is growing rapidly, so the construction of an additional electric car factory … will create a solid foundation for an important and explosive development phase ahead for VinFast,” said Nguyen Viet Quang, vice chairman and CEO of VinFast’s parent company Vingroup.
But whether the market actually will deliver on the company’s ambitious plans is yet to be seen. VinFast has so far failed to meet its goals, delivering just 44,773 vehicles worldwide during the first three quarters of 2024. It has set a full-year target of 80,000 and would have to rapidly accelerate deliveries to meet that goal.
Growth plans, growth pains
The VF3 will be the smallest of VinFast’s EVs.
VinFast was founded in 2017 and originally produced a mix of products including a licensed version of the BMW X5. It has since abandoned use of internal combustion technology, migrating to EVs. It currently produces several products, including the midsize VF8 crossover that, in 2023, became the carmaker’s first offering in the U.S.
Last month it delivered the first VF9 EVs to U.S. customers, that model serving as its new flagship.
But the goal is to add a wide mix of additional products, such as the subcompact VF3 and compact VF5 and VF6 crossovers. The new plant will specifically focus on those models.
Along with the second plant in Haiphong, VinFast has also laid out plans to set up assembly lines in Indonesia and India.
More VinFast News
- VinFast Hits the Brakes, Delays U.S. Plant Until 2028
- VinFast Shows Off Concepts at CES, Including EV Pickup
- Shakeup at troubled VinFast: Vietnamese automaker names new CEO, CFO
Setbacks
Work on the VinFast plant in North Carolina — shown here in a rendering — has been delayed three years.
Despite its aggressive goals, VinFast has been struggling to gain traction. With sales falling short of expectations its losses have been mounting. It recorded losses of $550 million during the third quarter of 2024 — though that was down from a year earlier.
The automaker has been expanding into new markets, notably in Southeast Asia. But its rollout in the United States has been troubled. The VF8 was expected to reach its first U.S. buyers in late 2022 but that was pushed back nearly half a year. And the electric SUV was the target of harsh reviews that led to slower initial demand.
That was a major factor in VinFast’s decision to delay the construction of its first North American plant. The facility, based in North Carolina, was originally set to open next year. It now has been pushed back until 2028.
It’s called ‘doubling down.’