Investing in Vietnam’s Electric Vehicle Industry – A Golden Opportunity for Domestic and International Investors
The Door is Wide Open in Vietnam
The electric vehicle (EV) market in Vietnam is experiencing impressive growth. According to the Vietnam Petroleum Institute (VPI), the car ownership rate in Vietnam stands at only 23 vehicles per 1,000 people—just one-tenth of Thailand's and one-twentieth of Malaysia's. Forecasts suggest EV sales could reach 65,000 units by 2030, nearly eight times higher than in 2022, with a compound annual growth rate (CAGR) of 26% from 2023 to 2032. Another study by Mordor Intelligence estimates the market to be worth USD 2.93 billion in 2025, increasing to USD 6.69 billion by 2030, at a CAGR of 18%.
Additionally, the Vietnam Automobile Manufacturers' Association (VAMA) predicts the country will have 1 million electric vehicles by 2028 and 3.5 million by 2040. Major players like VinFast, Hyundai, BYD, Geely, and Wuling are aggressively expanding, alongside investors focusing on charging infrastructure, batteries, and after-sales services.
Opportunities extend beyond manufacturing: the comprehensive EV value chain—from vehicle and battery production, charging infrastructure, to retail and after-sales—presents multiple profit-generating avenues. In particular, the retail and after-sales segment accounts for around 69% of the entire EV ecosystem’s value in Southeast Asia.
Legal and Policy Support in Vietnam
Vietnam has implemented a series of incentive policies to promote the EV industry. Since 2022, the government has applied:
A 3-year exemption from registration fees for battery electric vehicles;
A sharp reduction in special consumption tax (SCT), down to 1–3% (previously 5–15%).
The government is also considering electricity subsidies for EV charging stations to help reduce infrastructure investment costs.
Furthermore, the Investment Law and newly introduced decrees such as Decree 19/2025/NĐ-CP (effective from February 10, 2025) provide for special investment procedures that shorten licensing time and attract high-tech industries—including EVs.
Investment Regulations – Opportunities for Both Local and Foreign Investors
Under the Law on Investment and the Law on Enterprises, foreign investors may:
Establish a wholly foreign-owned limited liability company (LLC);
Form joint ventures with local partners (project durations up to 50–70 years);
Enter into business cooperation contracts (BCCs) without setting up a legal entity, taking on unlimited liability.
With incentives such as tax exemptions, reduced SCT, registration fee waivers, and fast-track investment procedures, Vietnam is becoming an increasingly attractive destination for both domestic and international investors.
Key Players and Real-World Momentum
VinFast, Vietnam's first electric car brand, has launched models such as VF‑8, VF‑9, VF 3, VF 5, VF 7, and plans to release VF Wild by 2026. However, VinFast currently faces financial challenges: a loss of nearly USD 2 billion in the first 9 months of 2024 has led Moody’s and Fitch to downgrade the credit rating of Vinhomes—a subsidiary of Vingroup. Nonetheless, Vingroup has pledged continued financial support for VinFast.
Beyond cars, the electric motorbike segment and battery-swapping infrastructure are also rich in potential. Startups like Selex Motors are developing electric scooters with battery swap stations and IoT-based management systems, collaborating with GrabExpress, Lazada, and BAEMIN, while attracting investment from ADB Ventures, Schneider Electric, and Touchstone.
Vietnam’s Competitive Advantages
Strategic location in ASEAN, facilitating global supply chain integration;
Cost-effective investment and production, especially by leveraging renewable energy and a young, affordable labor force;
Rapidly growing domestic demand and green transport services—e.g., Ho Chi Minh City’s plan to convert 400,000 tech and delivery vehicles to EVs is a significant catalyst.
Strategic Highlights for Investors
EV Manufacturing and Technology
Investing in the production of components, batteries, and vehicles as well as building supply chain connections is ideal, backed by incentives and geographic advantages.Charging Infrastructure and Energy
Building charging stations and battery-swap networks with smart management systems is becoming essential—especially for domestic use and low-emission transport strategies.After-Sales Ecosystem
Retail, leasing, after-sales services, and charging software management are highly lucrative segments, making up 69% of the EV value chain in Southeast Asia.Green Investment and Regulatory Compliance
Investors must pay attention to environmental regulations, licensing, and tax incentives—and can leverage fast-track procedures under Decree 19/2025.
Conclusion
Vietnam is opening a golden window for both domestic and international investors in the electric vehicle sector. With robust market growth foundations, strong policy support—from tax exemptions to streamlined licensing—alongside location, cost, and resource advantages, investing in EVs in Vietnam is becoming a journey where economic benefit and sustainable development go hand in hand.
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