VinFast asks for India EV import duty cut
Vietnamese electric vehicle manufacturer VinFast has made a request to India for a reduction in import duties on its cars, Reuters reported on Sunday, citing its India CEO, Pham Sanh Chau.
The purpose behind this appeal is to allow customers to become familiar with VinFast’s products while the company establishes a local manufacturing plant, Chau added.
VinFast has already commenced construction of a factory in the southern state of Tamil Nadu and aims to begin production by mid-next year. Initially, the focus will be on domestic sales, followed by exports.
Tamil Nadu and VinFast have agreed to work towards an investment of up to $2 billion, with an initial commitment of $500 million for the first five years of the project.
Similar to Tesla, VinFast has also sought a reduction in India’s 100 per cent import duty on fully-built EVs, which has faced opposition from domestic automakers. The Indian government is considering the requests but has not yet made a decision.
The company has proposed a temporary reduction of the import duty tax to 70-80 per cent for two years and a limited number of cars to allow customers to become accustomed to its products. The government is still reviewing the proposal.
Electric models accounted for only about two per cent of India’s car sales last year, but the government aims to increase this to 30 per cent by 2030 and is working on a programme to attract EV manufacturers.
The Tamil Nadu project is expected to have a capacity of up to 150,000 vehicles annually, compared to 250,000 at VinFast’s main plant in Vietnam. The company is also collaborating with 55 Indian dealers to establish a sales network and may consider selling its two-wheeler models in the country in the future.
