According to reports from Reuters, the Vietnamese automaker has suspended plans to manufacture three electric vehicles in India and ordered suppliers to halt work on the projects while it reassesses costs. The manufacturer has asked suppliers to "hold all activities" on three programmes, including a two-door SUV called VF3 - expected to be its most competitive model in the market - and the VF6 and VF7 SUVs, which it imports as kits from Vietnam and assembles in the country. In a July memo to suppliers, VinFast said it decided to "temporarily" put on hold all development work related to the VF3, VF6 and VF7. The suspension marks another setback for loss-making VinFast, which has turned to India for growth after facing difficulties gaining market share in the US and Europe. The move comes just one year after the automaker entered the Indian market in September 2025.
As reported by Reuters, the suspension marks another setback for loss-making VinFast, which has turned to India for growth after facing difficulties gaining market share in the US and Europe. The automaker opened its first factory outside Vietnam in southern India last year and pledged to invest $2 billion, as it sought to build a regional manufacturing base serving South Asia, the Middle East and Africa. VinFast did not directly address whether it suspended local manufacturing plans for the three models, stating it has not changed or suspended plans for the VF6 and VF7 models currently on sale in India and will continue to assemble them at its factory. The suspension of plans to locally manufacture the three vehicles in India has not been previously reported, highlighting the challenges faced by international automakers in establishing successful operations in the competitive Indian market.
According to Reuters sources, VinFast did not meet its planned costs for developing parts in India for the three cars, which is why it stopped the work. The July memo to suppliers also asked for a detailed breakdown of the "total amount invested to date" on the projects across cost categories such as tooling, engineering and materials, along with "supporting documentation where available." A company representative told Reuters that based on market research and consumer feedback, VinFast is making "appropriate adjustments" to its products to "better meet the needs of Indian customers." Locally developing and sourcing parts would have allowed VinFast to avoid expensive imports and price its cars more competitively.
As reported by Reuters, VinFast has so far sold about 10,000 cars in India, including to its affiliate ride-hailing company Green SM. The automaker launched in India in September 2025 with its VF6 and VF7 electric SUVs, with its India factory having an initial annual production capacity of 50,000 cars and scalable to 150,000 units. VinFast said it plans to develop India-specific models, rather than just bringing in existing global models, as it continues to struggle to break into the world's third-largest car market. The company's India operations are backed by Vietnam's largest conglomerate Vingroup.
According to Reuters, VinFast's struggle to break into the Indian market echoes challenges faced by other automakers, including Volkswagen and Nissan, which did not achieve the kind of scale that has helped companies such as Suzuki and Hyundai succeed. "India is an important market in VinFast's long-term business and manufacturing strategy," a company representative told Reuters, adding that the company remains committed to the Indian market despite the current setbacks. The suspension of plans to locally manufacture the VF3, VF6 and VF7 in India has not been previously reported, highlighting the challenges faced by international automakers in establishing successful operations in the competitive Indian market.
