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VinFast Shifts Focus to Vietnam, Scaling Back US Ambitions

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  Published in Automotive and Transportation on Tuesday, January 6th 2026 at 10:35 GMT by reuters.com

VinFast Accelerates Vietnam Focus Amidst Global Challenges, Aims to Nearly Double Deliveries by 2026

Vietnamese electric vehicle (EV) startup VinFast is shifting its strategy, prioritizing deliveries within Vietnam while simultaneously navigating challenges in the US market. According to a recent report from Reuters, the company plans to nearly double its annual delivery targets in Vietnam by 2026 and will be significantly ramping up local production – a move reflecting a recalibration of ambitions and a recognition of current economic realities.

The core of VinFast’s revised approach lies in addressing persistent issues with US market penetration. The company, backed by Vietnamese conglomerate Vingroup, launched its VF8 SUV and VF9 crossover in the United States in 2023, aiming to disrupt the established EV landscape dominated by Tesla, Ford, and others. However, initial reception has been lukewarm. Reuters reports that a significant factor hindering US sales is the company’s reliance on a direct-to-consumer model coupled with a battery subscription service – a unique approach that has confused and alienated potential buyers unfamiliar with the Vietnamese brand and its unconventional financing options. The battery subscription, intended to lower the upfront vehicle cost, proved particularly unpopular as it added complexity and ongoing financial obligations.

Early reviews of VinFast's vehicles haven’t been universally positive either. While praising design elements, critics have pointed out issues related to software glitches, quality control concerns, and a lack of established charging infrastructure support in the US. The company has also faced challenges securing regulatory approvals and navigating the complexities of establishing a manufacturing presence in North America. The initial plan involved building an EV factory in North Carolina, but progress has been slower than anticipated, further delaying direct US production and increasing reliance on imports from Vietnam.

This backdrop prompted VinFast to refocus its efforts closer to home. The company now intends to deliver approximately 140,000 vehicles annually in Vietnam by 2026, a substantial increase from the roughly 73,000 delivered in 2023. This renewed focus is bolstered by government support and a rapidly growing domestic demand for EVs. Vietnam's electric vehicle market is still nascent but exhibits significant potential due to increasing environmental awareness, rising incomes, and supportive government policies aimed at promoting EV adoption. The Vietnamese government has been actively offering incentives such as registration fee exemptions and tax breaks for EV purchases.

To achieve this ambitious delivery target, VinFast plans to significantly expand its local manufacturing capacity. The company is investing in a new factory in Hai Phong, Vietnam, which will utilize advanced robotics and automation technologies to boost production efficiency. This expansion aims to not only meet domestic demand but also potentially serve as an export hub for other Southeast Asian markets. The Reuters report highlights that this localized production strategy reduces reliance on imports, mitigating supply chain vulnerabilities and lowering costs – crucial factors in a competitive EV market.

The shift isn't a complete abandonment of the US market. VinFast still intends to enter the North American market but with a more measured approach. The company is exploring alternative sales strategies including partnerships with dealerships, re-evaluating its battery subscription model (potentially offering outright battery purchase options), and working on addressing quality control issues identified by early reviewers. They are also accelerating efforts to secure US regulatory approvals and finalize plans for the North Carolina factory, although timelines remain uncertain. VinFast’s CEO Le Thi Thu Thuy recently stated that while the U.S. remains a key market, the company needs to prioritize profitability and sustainable growth, which currently necessitates a stronger foothold in Vietnam.

Furthermore, VinFast is expanding its product line beyond SUVs. The company has unveiled plans for electric scooters and smaller EVs tailored to the Vietnamese market, catering to diverse consumer preferences and price points. This diversification strategy aims to broaden their customer base within Vietnam and potentially create new export opportunities. They are also developing a more affordable compact SUV, the VF3, specifically targeted at the budget-conscious Vietnamese consumer.

Ultimately, VinFast's revised strategy represents a pragmatic response to challenging market conditions. While ambitious global aspirations remain, the company is prioritizing stability and growth within its home market while carefully re-evaluating its approach to international expansion. The success of this recalibrated plan will depend on VinFast’s ability to execute effectively – expanding production capacity, addressing quality concerns, refining its sales strategies, and capitalizing on the growing demand for EVs in Vietnam and Southeast Asia. The company's journey is a compelling case study in the complexities of launching an EV brand in a rapidly evolving global automotive landscape.

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