Vietnamese electric car maker VinFast plans to invest as much as $2 billion to construct its first North American automative assembly and battery manufacturing plant in North Carolina.
The project at the Triangle Innovation Point megasite in Chatham County will be the state’s first car manufacturing plant and it is the largest economic development announcement in North Carolina’s history.
Gov. Roy Cooper and Le Thi Thu Thuy, Vingroup vice-chair and VinFast Global CEO, made the announcement on March 29 at the new Raleigh Convention Center.
“North Carolina is quickly becoming the center of our country’s emerging, clean energy economy,” Cooper said in a statement. “VinFast’s transformative project will bring many good jobs to our state, along with a healthier environment as more electric vehicles take to the road to help us reduce greenhouse gas emissions.”
VinFast’s factory will create a major manufacturing center on a 1,977 acre (800 hectare) plot for phase 1 with 3 main areas: electric cars and buses production and assembly, EVs batteries production, and ancillary industries for suppliers.
Construction for phase 1 of the factory will start in 2022 after the construction permit is granted and production is expected to start in July 2024. The capacity of phase 1 is expected to be 150,000 vehicle/year.
According to the MOU, VinFast will continue to invest in this factory in various phases. Vehicles to be produced at the site include the VinFast VF 9, a 7-passenger all-electric Sport Utility Vehicle (SUV) and the VinFast VF 8, a 5-passenger, all-electric mid-size SUV.
The North Carolina Department of Commerce coordinated the state’s recruitment of VinFast, which also involved state, regional, and local organizations.
“Automotive assembly plants are incredible engines for economic growth, due to the positive ripple effects they create across a region’s economy,” said North Carolina Commerce Secretary Machelle Baker Sanders. “I’m so pleased that VinFast has decided to launch their North America manufacturing operations from our state, and we’ll work hard to make sure they find the skilled workforce they’ll need to grow and thrive in North Carolina.”
VinFast, founded in 2017 as a wholly-owned subsidiary of the Vietnamese conglomerate Vingroup, is a global producer of automobiles. The company is headquartered in Hanoi, Vietnam, and has a vehicle production facility in Hai Phong, Vietnam, that has the capacity to produce 950,000 vehicles per year by 2026.
VinFast has established global operations in the US, Canada, Germany, France and the Netherlands. VinFast currently provides an ecosystem of EV products in its home country of Vietnam, including e-scooters, electric buses and electric cars, charging station system and green energy solutions.
Last November, VinFast announced the VF e35 and VF e36 (now named the VF 8 and VF 9) at the 2021 Los Angeles Auto Show. The company introduced three new EVs (the VF 5, VF 6 and VF 7) at the 2022 Consumer Electronics Show (CES), which combined with the earlier models allows the company to serve all five major vehicle segments, from small crossover to large SUV. Each vehicle embodies VinFast’s goal of offering leading technology with a premium experience at an attainable price point. Reservations for VF 8 and VF 9 was announced globally at the beginning of 2022.
“North Carolina’s strong commitments in building a clean energy economy, fighting climate change and reducing greenhouse gas emissions in transportation make it an ideal location for VinFast to develop its premium, smart and environmentally friendly EVs.” said Le Thi Thu Thuy, Vingroup Vice Chair and VinFast Global CEO. “Having a production facility right in the market will help VinFast to proactively manage its supply chain, maintain stabilized prices and shorten product supply time, making VinFast’s EVs more accessible to customers, contributing to the realization of local environmental improvement goals.”
VinFast is the only premium car producer in Vietnam and has been growing with an impressive rate. The company completed the construction of its factory in Haiphong and developed its first three car models in just 21 months.
Recently, Vingroup started construction of a battery plant in Ha Tinh, Vietnam on a 8 hectare plot for phase 1, with a capacity of 5 gigawatt hours (GWh) per year. The facility is expected to be fully installed and run at full capacity from late 2022.
The project in North Carolina affirms VinFast’s commitment in investing and developing business in its international markets in general and the U.S. in particular. It will also ensure VinFast’s capability in manufacturing autonomy globally.
VinFast’s project in the state, which will officially be executed through a newly formed company, will be facilitated in part by a Transformative Job Development Investment Grant (JDIG) approved by the state’s Economic Investment Committee earlier today. VinFast’s project is estimated to grow the state’s economy by at least $71.59 billion over 32 years, the time period when the grant could be active. Using a formula that takes into account the new tax revenues generated by the new jobs, as well as a company investment of $4 billion, the JDIG agreement authorizes the potential reimbursement to the company of up to $316.1 million, paid over a time period of 32 years.
VinFast’s JDIG agreement calls for moving as much as $36.6 million into the state’s Industrial Development Fund – Utility Account. The Utility Account helps rural communities anywhere in the state finance necessary infrastructure upgrades to attract future business.
The state also anticipates providing additional support to the project by means of a state appropriation of as much as $450 million, to cover site preparations, road improvements, and additional water and sewer infrastructure.