Posted on 18 Sep 2023
Vietnamese automaker VinFast says it plans to focus more on the Indonesian market, where it intends to build its second overseas EV plant, Kallanish reports.
According to a U.S. Securities and Exchange Commission (SEC) filing, Indonesia will become a new market of growth for the company under its Phase 2 plan from 2024, when the carmaker will adopt two major business models. This is based on a new sales network to expand its global presence.
It plans to start delivering right-hand driving models of the VF e34 and VF 5 in Indonesia in 2024, with the VF 6 and VF 7 models to follow. VinFast believes the Southeast Asian country can be a potential spot for regional EV and battery manufacturing facilities due to the relatively “lower costs and sufficient raw material storage.”
It has initially confirmed a $1.2 billion long-term investment plan in Indonesia based on its assessment of the opportunities in this market. Around $150-200 million of this investment will be used to establish a completely knocked-down (CKD) factory with a production capacity of 30,000-50,000 units. This production is expected to start in 2026.
The EV plant investment, however, is subject to “market conditions and other factors,” the company notes, adding there are several potential risks in its future plans. For example, financial risks due to previous losses and the ability to raise more capital to support the expansion; limited access to EV charging stations or related infrastructures; and lack of experience and support abroad.
Currently, the carmaker is focusing on three target markets – Vietnam, North America (the United States and Canada), and Europe (including France, Germany, and the Netherlands). In its second phase of development, a distribution network will be established in Asia (India, Indonesia, Malaysia), the Middle East, Europe (other areas not covered), Africa, and Latin America.
VinFast first planned overseas EV factory is in North Carolina, US. The facility will produce 150,000 units/year, with commissioning slated for 2025.
Source:Kallanish
