VinFast Commits To $2 Billion Factory In North Carolina, Or Is It $4 Billion?

VinFast announced this week that it has entered into an agreement to construct a manufacturing facility to build electric vehicles, such as SUVs and buses, in North Carolina. According to Reutersit plans an initial investment of $2 billion for the factory with anther $2 billion possibly going for the construction of a battery manufacturing plant at the same location.

Construction could begin this year, after the company gets all the necessary permits. Production is expected to begin no later than July of 2024. The plant’s initial capacity will be 150,000 units per year, Vinfast says. “With a manufacturing facility right in the US market, VinFast can stabilize prices and shorten product delivery time, making our EVs more accessible to customers,” says Nguyen Thi Thu Thuy, CEO of VinFast. The company has begun taking pre-orders globally for two electric SUVs being manufactured in Vietnam and expects deliveries to begin before the end of this year.

President Biden said the VinFast investment will create more than 7,000 jobs and is “the latest example of my economic strategy at work.” It builds on recent announcements from companies like GM, Ford, and Siemens to invest in America again and create jobs, Biden added. His administration has set a goal for half of all new private passenger vehicle sales to be electric by 2030.

This will be North Carolina’s first car plant and it is the largest economic development announcement in the state’s history, the governor’s office said in a statement. VinFast said prices for its VF8 sport SUV started from $41,000 in the United States. The company is targeting sales of 42,000 worldwide this year. Bear in mind that the company supports a battery leasing model, so whether that price includes a battery or not is unclear at the moment. Battery leasing can calm the fears of some potential customers who worry about being stuck with an expensive battery replacement after a few years of ownership.

The Rest Of The VinFast In North Carolina Story

Jalopnik is one of our favorite automotive news sites because of its well deserved reputation for looking behind the press releases and speaking truth to power. In its article about the VinFast announcement, it quotes a particularly snarky comment from one of its readers:

“So I live in the Raleigh, NC area and have almost all my life. The state government is giving away hundreds of millions of dollars to an EV startup from Vietnam called Vinfast.

“Who the hell is Vinfast? It barely looks like they have any actual autos on the market right now and the only details we have are what the company says in pressers. Motor Trend tried to contact them about their supposed foray into the US market this year and got silence. They claim they’re going to employ 13,000(!) to build 2 SUVs (surprise). That’s twice as many people than work at Ford River Rouge making a car people actually buy (F150).

“But the Governor is desperate to cut a ribbon so now some Vietnamese oligarch gets a half billion in incentives and free land (a site that they’ve shopped to Toyota, Daimler, Kia, and VW) to build…something. No one has enough knowledge of these things to say if they’ll even survive heat/cold extremes in this country.”

There are undercurrents of racism and xenophobia and America First in that tirade. I myself find it remarkable that a Vietnamese company would have any interest in doing business in America — a country which pummeled Vietnam to a pulp for more than a decade and left it with a tragic legacy of environmental destruction thanks to the ravages of Agent Orange. Having the opportunity to serve in the military during those turbulent times, I well remember the horrible and disgusting things American soldiers had to say about the local people.

My own father refused to buy a Japanese car during his lifetime and I suspect there are some older Americans who will feel the same way about buying a car from a Vietnamese company. There is also a question whether the good people of North Carolina will welcome executives of Vietnamese origin into their communities. “America First” and hatred of foreigners is still a powerful force in many parts of America.

I don’t know what the Vietnamese word is for chutzpah, but VinFast has an uphill journey to win acceptance from American customers. All we can say is Chúc may mắn. This is a bold move and we wish them well. The more EVs for sale the better.


 

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