VinFast to build EV plant in Germany, batteries in the USA

The Vietnamese vehicle manufacturer VinFast is planning a factory in Germany to produce electric cars and buses. There is already speculation about a specific location. In addition, VinFast is also planning a battery factory in the USA.

++ This article has been updated. Kindly continue reading below. ++

In the search for a location for a new plant in Germany, VinFast is cooperating with Germany Trade & Invest (GTAI), a company of the Federal Republic of Germany for foreign trade and location marketing. VinFast made the announcement on the sidelines of the CES in Las Vegas. There, electric vehicles, passenger cars as well as buses are to be produced.

At the end of September 2021, VinFast had given more details on its European strategy. According to this, the company’s first two electric cars, the VF e35 and the VF e36, are to make their market debut in three European countries this year, including Germany. Initially, however, these models will still be imported from Vietnam.

Le Thi Thu Thuy, who succeeded Michael Lohscheller as CEO in December and is also vice-chairwoman of the overall VinGroup, calls the plant in Germany a milestone in VinFast’s European strategy. “The era of shipping cars around the world is over, especially since COVID-19,” the manager said. “You must have the factory close to the market in order to win over your customers.”

Is VinFast taking over Opel’s Eisenach plant?

Opel’s announcement says: “Accompanying the search for a manufacturing plant for Europe, the Vietnamese automotive group is developing a production strategy for current and future markets. Further announcements on this will follow.” Whereas in the beginning there was still talk of setting up a production facility, here there is no longer any explicit mention of finding a location for building a plant. The “search for a production site” could also be interpreted as the takeover of an existing location.

For example, the German newspaper Frankfurter Allgemeine Zeitung (FAZ) speculates that the Opel plant in Eisenach, which is on the brink of collapse, could pass into the hands of VinFast. The Vietnamese manufacturer was until recently headed by former Opel boss Michael Lohscheller, but he resigned. However, the FAZ does not name a source for this speculation.

VinFast currently builds its cars in its home country at the production complex in Hai Phong – not only its electric vehicle models, but also internal combustion vehicles, some of which are based on BMW technology. However, as VinFast now states, the combustion engine production is to be phased out at the end of this year in order to concentrate fully on electric mobility. Recently, the construction of a battery production facility began in the Vung Ang economic zone. In the first phase, up to 100,000 battery packs are to be produced there from supplied cells; in the second phase, the company also plans to manufacture its own cells and expand to one million battery packs.

While no timeframe is given for the planned factory in Germany – possibly because the timeframe would be quite different for the Eisenach acquisition than for the construction of a new factory – VinFast states in the announcement that it plans to open an e-vehicle plant in the US in the second half of 2024.

The vehicle plant is not the only US project: VinFast’s new CEO Le Thi Thu Thuy also confirmed plans for a battery factory in the US to Reuters. Initially, battery packs with supplied cells will be assembled there and later cells will also be manufactured. In the USA, out of originally more than 50 potential locations, about three are now on the shortlist. A decision on the US site, where a production facility for e-buses is planned in addition to the battery factory, is to be made this year. Electric cars are also to be manufactured in the USA from the end of 2024.

Update 13 January 2022

In an interview with the US portal The Detroit Bureau, VinFast boss Le Thi Thu Thuy gave another detail about the planned US vehicle plant. “We are planning to build a factory that can manufacture about 250,000 vehicles per year, and a Gigafactory to manufacture battery cells and the pack. And there will be another electric bus factory, as well,” Thuy said. This will involve selling the vehicles in North America rather than exporting them. “We don’t think 250,000 is a lot, starting in 2024, for the North American market. That would be a lot if we were just trying to get (traditional) EV customers. We’re looking to switch consumers from ICE to EVs. When you look at the combined market, there’s a lot (of potential customers).”

Source: Info via email (factory), faz.net (Eisenach speculation, in German), reuters.com (US battery plant), thedetroitbureau.com (update)