Vietnamese electric vehicle maker VinFast has temporarily stopped plans to manufacture three electric cars in India as it reviews development costs, according to sources and a company memo reviewed by Reuters.
The company has asked suppliers to pause all work on three models — the VF3, VF6 and VF7. The VF3 is a two-door electric SUV that was expected to be one of VinFast’s most competitive models in India.
The VF6 and VF7 are currently imported as kits from Vietnam and assembled at VinFast’s Indian factory.
VinFast Reviews Costs
The decision is another challenge for VinFast as the company looks to grow in India after struggling to gain a strong market share in the US and Europe.
A July memo sent to suppliers said development work related to the VF3, VF6 and VF7 had been temporarily put on hold.
Developing and sourcing parts locally could have helped VinFast reduce import costs and offer its electric vehicles at more competitive prices. However, one source said the company did not achieve its planned cost targets for developing parts in India.
VinFast has also asked suppliers to provide details of the money already spent on the three projects, including costs related to tooling, engineering and materials.
India Remains Important Market
VinFast opened its first factory outside Vietnam in southern India last year and had announced plans to invest $2 billion as part of its expansion.
The company’s India plant has an initial production capacity of 50,000 vehicles a year, which can be increased to 150,000 units.
VinFast entered the Indian market in September 2025 with the VF6 and VF7 electric SUVs. It has sold around 10,000 vehicles in India so far, including vehicles supplied to its affiliate ride-hailing company Green SM.
VinFast did not directly confirm the suspension of local manufacturing plans for all three models. The company said its plans for the VF6 and VF7 currently sold in India have not been suspended and that it will continue assembling them at its Indian factory.
The company said India remains an important part of its long-term business and manufacturing strategy. It also said it is making changes based on market research and customer feedback to better meet the needs of Indian buyers.
Focus on India Specific EVs
VinFast said it plans to develop India-specific electric vehicle models rather than simply bringing existing global models to the country.
The company had earlier planned to use India as a manufacturing base for markets across South Asia, the Middle East and Africa.
The latest decision comes as VinFast faces the challenge of building scale in India, one of the world’s largest car markets, while controlling costs and increasing local sourcing.
