EV maker VinFast asks India to cut duties
Vietnamese electric vehicle (EV) maker VinFast had asked India to reduce import duties on its cars for about two years so customers could get familiar with its products while a local manufacturing plant came on stream, an executive said on Sunday.
VinFast had started building a factory in the southern state of Tamil Nadu and hoped to start production by the middle of next year, first for domestic sales and then exports, its India CEO, Pham Sanh Chau, said.
VinFast and Tamil Nadu said last month they had agreed to work towards an investment of up to $2bn, with an intended commitment of $500m for the first five years of the project.
Like Tesla, VinFast has asked for a reduction to India’s 100% import duty on fully built EVs, which has been opposed by domestic carmakers.
India, the world’s thirdlargest vehicle market, had been considering the requests but had not made a decision, a government official said last month. Another government spokesperson did not immediately respond to a request for comment.
“We proposed a reduction of import duty tax … for instance by bringing it to 70%-80% just for two years and for a very limited number of cars for the customers to get used to our products,” Pham said at the sidelines of VinFast’s groundbreaking ceremony in Thoothukudi district.
“The central government is still considering it.
“But while waiting for the final decision … we move ahead with our construction of the manufacturing facility.”
Electric models accounted for just about 2% of India’s car sales last year, but the federal government is targeting 30% by 2030 and is working on a programme to attract EV makers.
The Tamil Nadu project would have a capacity of up to 150,000 vehicles annually, compared with 250,000 at its main plant in Vietnam, according to VinFast.
Pham, a former Vietnam ambassador to India, said the company was closely working with about 55 Indian dealers to have a sales network and could also look to sell its two-wheeler models in future. “As a start-up company, we move fast,” he said.
LIKE TESLA, VINFAST HAS ASKED FOR A REDUCTION TO INDIA’S 100% IMPORT DUTY ON FULLY BUILT EVS, WHICH HAS BEEN OPPOSED BY DOMESTIC CARMAKERS