Following its move to build a $4 billion electric vehicle (EV) factory in the United States, Vietnamese car manufacturer VinFast will spend $400 million to construct factories in Indonesia and India.
The company has optimised its capital expenditure plan for global manufacturing in 2024 and 2025, which is expected to save approximately $400 million over previous estimates. These savings are to be put towards building completely knocked down (CKD) factories in Indonesia, the most populous country in Southeast Asia, and India, the third-largest auto market in the world, according to Nikkei Asia.
VinFast aims to access the tremendous potential for increased EV adoption in both nations, where EV penetration is currently only 1 per cent. The establishment of VinFast facilities in these markets could provide access to government incentives for local manufacturing, relief from certain tariffs and taxes, and access to raw materials at attractive rates.
Each CKD facility has a planned total capacity of up to 50,000 cars per year and an estimated total capital expenditure of $150-200 million in phase 1. Production is expected to commence by 2026.
Meanwhile, FPT Corporation has plans to invest $100 million into the US market by the end of this year. It has entered into a comprehensive strategic partnership with Landing AI – a US computer vision platform and AI software company – to accelerate the integration of AI across its educational system, FPT Education.
Furthermore, FPT Semiconductor JSC has also inked a deal with the US-based Silvaco to enhance personnel development in the semiconductor sector.
According to the Foreign Investment Agency under the Ministry of Investment and Planning, Vietnam's outbound investments reached $416.8 million in the first nine months of 2023, up 4.6 per cent on-year.
Over this period, 84 projects totalling more than $244.8 million in fresh investment were approved, a decline of 29.5 per cent on-year. However, 18 projects adjusted their capital outgoings to the tune of an additional $172 million, almost 3.38 times as much as last year.
In terms of destination nations, Canada received more than $150 million in Vietnamese capital in the first nine months, followed by Singapore with $115 million and Laos with $114 million.
As of September 20, Vietnam has 1,667 investment projects in operation across 24 countries and territories, totalling over $22.1 billion in investment capital.
According to a government report sent to the National Assembly, Vietnamese state-owned enterprises (SOEs) injected $61.5 million. Up to December 2022, the cumulative investment capital of these SOEs reached $6.6 billion. PetroVietnam accounted for 60.8 per cent of the overseas capital, followed by Viettel (22.2 per cent) and Vietnam Rubber Group (11.6 per cent).
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