Now, the richest man in Vietnam with a net worth of over $4 billion, Pham Nhat Vuong, has said that he would investor another billion dollars of his personal fortune into his electric car making company, Vinfast, according to a Bloomberg report.
Aside from the US and Indonesia, Vinfast has already committed investments in is India and started construction of its plant that would be operational next year.
| Stock | Change in 2024 |
| Vinfast | -64% |
| Tesla | -35% |
Musk and Vuong are keeping the faith on the prospects for electric cars
Globally, there’s a fall in people buying electric cars leading to a price war led by Tesla offering deep discounts in major markets.
Companies like General Motors and Ford, which are older international peers for Tesla and Vinfast, have cut back on the production electric cars and, instead, have shifted focus to hybrid cars that seem to have more takers. “This is not the right strategy,” Musk told analysts after the company’s quarterly earnings on April 24 showed the sharpest drop in quarterly revenue since 2012.
Tesla is driving down prices of electric cars — and laid off thousands of employees — in the face of slowing demand but has revealed plan to increase production capacity to 3 million cars from the current 2.35 million.
FILE PHOTO: Tesla Chief Executive Officer Elon Musk gets in a Tesla car as he leaves a hotel in Beijing, China May 31, 2023. REUTERS/Tingshu Wang//File Photo
Meanwhile, Vinfast, a much smaller company compared to Tesla, plans to increase its production capacity to 550,000 electric cars a year by 2026 from the current 300,000.
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More than half of Vinfast’s added capacity would come India
VinFast is building a factory in Tamil Nadu that would start production in 2025, and will eventually have a capacity of producing 150,000 EVs in a year. The company’s plant in Vietnam has a capacity of 250,000 units.
Aside from this, the company is also reportedly planning a battery manufacturing plant in Thoothukudi, which is also a city in southern Tamil Nadu.
The company has already committed to invest $500 million in the first five years of the project and has plans to scale up the investment in India to $2 billion.
Tesla too is interested in investing in India. Musk had announced a trip to India earlier in April 2024 where he would meet the country’s Prime Minister Narendra Modi before cancelling the plan due to some scheduling constraints.
CNBC-TV18 has learnt that Tesla’s Chief Sourcing Officer will soon visit India to meet leading component manufacturers. A source requesting anonymity said that Tesla may increase its purchases of auto components from India to $15 billion over the next five years.
In this image made from video provided by Narendra Modi Youtube Channel, Indian Prime Minister Narendra Modi, right, met Tesla and SpaceX CEO Elon Musk, left, during a meeting in New York, Tuesday, June 20, 2023.( Narendra Modi Youtube Channel via AP)
Both Vinfast and Tesla have sought relaxations in the Indian government’s policy aimed at boosting electric car production in one of the world’s third-largest market for automobiles.
Musk also wants permission to launch Starlink, a satellite-based internet service provider, in India.
Indian government is keen on increasing the production and sales of electric vehicles in India.
The attempts to shift millions of Indians from the traditional combustion engine cars to to electric vehicles is part of a larger strategy to mitigate the impact of climate change.
The sales of electric vehicles in India increased 50% to 1.5 million units in 2023, and the share of EVs in the overall automobile sales has gone up to 6.3% in 2023 from just 1.7% in 2021.
Vuong is already invested in one of the world’s biggest markets with a large headroom for growth. When will Musk sign the dotted line?
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