VinFast and Green SM: Can Vietnam’s EV Giant Challenge Tata Motors, Mahindra and Ola in India? 

Synopsis: Vietnam’s VinFast is making an aggressive push into India through local manufacturing, a potential long-term investment roadmap of up to Rs 19,000 crore and its integrated Green SM mobility ecosystem. With India’s EV market still underpenetrated, the company could emerge as a formidable challenger to incumbents such as Tata Motors, Mahindra and Ola Electric. 

India’s electric vehicle market is entering a new phase of competition as global and domestic players race to secure a share of one of the world’s fastest-growing EV opportunities. Amid this transition, Vietnam’s VinFast has emerged as a serious contender with plans for local manufacturing, significant long-term investments and the introduction of its Green SM mobility ecosystem. Backed by ambitious global expansion plans and India’s rapidly evolving EV landscape, an important question emerges: Can VinFast disrupt established players such as Tata Motors, Mahindra and Ola Electric? 

From a Vietnamese EV Maker to a Global Challenger

Up until about a decade ago, Vietnam was not even considered in international car talks. This trend changed quickly when VinFast, the vehicle manufacturing division of Vingroup, Vietnam’s largest privately owned conglomerate group, operating across real estate, healthcare, retail, education, and technology segments, was established. 

Established in 2017, VinFast initially launched internal combustion engine cars but made a quick move to electric mobility solutions, turning into an EV-only manufacturer now. In 2024, the company produced 97,399 electric vehicles worldwide, achieving almost 192% of growth compared to the previous year. 

VinFast plans to achieve one million vehicles’ production capacity annually by 2030. The quick expansion of VinFast into markets like North America, Europe, Indonesia, and the Philippines shows the company’s long-term international aspirations; India became one of the most strategically important markets for the company.

Why India Has Become Strategically Important 

The Indian auto market has become one of the most desirable around the world and is currently ranked as the third biggest passenger vehicle market in the world, with sales of above 4.3 million per year. Even with this impressive sales number, passenger EV penetration in India has remained at 7.75%, which is quite low compared to China, where EV penetration has crossed 40%. 

Just a 20% increase in penetration of EVs in India in the coming ten years can bring annual passenger EV sales to more than a million units. Passenger EV sales have been growing fast over the last few years because of the improvements made in charging infrastructure, drop in battery costs and increased consumer acceptance. 

India presents VinFast with the opportunity to gain access to one of the biggest under-penetrated EV markets in the world and also a manufacturing and export base for South Asia, the Middle East and Africa.

VinFast’s India Manufacturing Ambitions

Unlike some other global automotive companies that choose to first penetrate the Indian market through importing their products, VinFast has decided to adopt a localisation strategy. The company has made an initial investment of US$500 million over five years in the manufacturing plant in Tamil Nadu. 

This plant covers a land area of around 400 acres and will provide jobs to about 3,000 to 3,500 people. VinFast will have a production capacity of around 50,000 cars initially, which can later be scaled up to almost 150,000 units per year. It is important to note that this is only the beginning for the company. According to the MOU signed by the Tamil Nadu government, there is a possibility of total investments up to US$2 billion, or nearly Rs 19,000 crore, in the long run. 

Even though this does not constitute any committed capital expenditure from the company, it still shows that VinFast has ambitious plans in India. For example, Mahindra has plans of investing around Rs 16,000 crore in its EVs, and Tata Motors has announced investments of over Rs 18,000 crore for its EV ventures.

Green SM Could Become VinFast’s Biggest Differentiator

What is possibly even more interesting about the India strategy implemented by VinFast is not the cars themselves, but the entire ecosystem around them. Thanks to Green SM, VinFast is now one of the largest all-electric mobility ecosystems in Vietnam, offering taxis, rideshare services and corporate mobility solutions using only electric vehicles. 

In contrast to conventional car manufacturers, who rely on the demand from consumers alone, Green SM helps VinFast to generate the demand for their vehicles through fleet use and mobility services. VinFast has started implementing this strategy globally already. Green SM came into India via Green SM Limo and established cooperation with the corporate mobility platform Routematic, serving more than 400 enterprises. 

This means that VinFast’s plans with respect to India go far beyond just selling passenger cars there. For many EV makers around the world, one of the key problems is how to generate enough demand and maximise usage of vehicles. Green SM may help VinFast solve this problem by generating its customer base through rideshare fleets and employee mobility solutions.

This ecosystem approach resembles strategies adopted by global EV leaders such as Tesla and BYD, where manufacturing, charging infrastructure and mobility services complement each other. Few Indian players currently possess such integrated capabilities. While Tata Motors has manufacturing scale and Ola Electric has mobility experience, neither currently operates a fully integrated ecosystem comparable to Green SM. 

Can VinFast Challenge Tata Motors? 

At present, Tata Motors retains its position as the largest manufacturer of electric passenger vehicles in India. The firm managed to sell about 92,000 electric passenger vehicles during FY26 and continues to maintain its leadership by means of such models as Nexon EV, Punch EV, Tiago EV and Curvv EV. 

Nonetheless, competition has gradually affected Tata Motors’ dominant position, with its market share reducing from above 70% a few years ago to roughly 38%. This case illustrates an essential fact about the current situation on India’s EV market. The industry is rather dynamic, and many of the leadership positions may change. 

For instance, VinFast may become a significant competitor to Tata Motors, especially in terms of the premium electric SUV segment. Should VinFast launch feature-packed models, locally manufactured and priced competitively, it would be able to attract consumers interested in alternative options in the segment.

Nonetheless, Tata Motors has some advantages that cannot be underestimated. It features the largest dealer network in India, a large number of supplier relationships, a high level of localisation and decades of customer trust. Besides, all Tata Group companies have invested heavily into such aspects of the EV industry as charging infrastructure and battery manufacturing.

Mahindra Could Become VinFast’s Biggest Rival

It is interesting to note that Mahindra could well turn out to be the biggest competitor to VinFast in India, having developed itself into one of India’s fastest-growing EV firms through its Born Electric range and making EV investments in the region of Rs 16,000 crore.

VinFast and Mahindra seem to target almost identical market segments. While VinFast’s offerings on a global scale are dominated by premium electric SUVs, Mahindra enjoys high brand equity and expertise in this very segment. In addition, SUVs continue to be one of the fastest-growing segments in India’s passenger car market.

Thus, the existing manufacturing capacity, distribution channels, and positioning among utility vehicles can work for a competitive advantage for Mahindra. It may thus turn out to be one of the most interesting areas of rivalry in the premium EV market of India.

Ola Electric and the Massive Two-Wheeler Opportunity 

While VinFast’s near-term attention will probably stay focused on 4-wheeler automobiles, it has also announced some initiatives in relation to electric motorcycles and buses, which may mean that at a certain point it will come to compete with Ola Electric directly.

India continues to be the largest producer of two-wheelers in the world, with annual industry volume exceeding 22 million units. The share of electrification in this segment is quite low, which means plenty of room for future growth. 

Presently, Ola Electric enjoys great popularity and recognition; however, it faces increased competition from such companies as TVS Motor, Bajaj Auto, and Ather Energy. With the help of the manufacturing abilities of VinFast and the Green SM ecosystem, it can turn into another significant player in this industry segment.

Lessons From MG Motor’s Success 

The most critical lesson from MG Motor for VinFast would perhaps be its own example. Some years back, nobody expected MG to become a strong player of EVs in India. The competitive pricing and good product range helped the company grow in a short span of time.

The number of passenger EV sales in India rose from 37,730 units in FY25 to 62,591 units in FY26. In the meantime, the market share of MG grew fast while that of Tata Motors declined steadily. 

It clearly indicates that Indian customers are becoming more receptive towards newer brands as long as the latter provide better technology, competitive prices, and ownership experiences. This is what the MG Motor example shows us about the possibility of making a market position in India through EVs.

Policy Tailwinds Could Support VinFast 

The government policies remain one of the key tailwinds driving India’s electric mobility industry forward. Programs like FAME and Production Linked Incentive have been instrumental in making investments in various parts of the value chain of EVs, while the state of Tamil Nadu has become a leading center for the manufacture of vehicles in India owing to its robust infrastructure, supplier base and conducive policies.

India is also pursuing localisation of battery and component industries, which can make the business of manufacturing EVs in India quite economically viable in the longer run. This can be highly advantageous for firms like VinFast, which are ready to invest big money in manufacturing locally.

Risks Cannot Be Ignored 

However, despite the benefits, VinFast encounters several issues. VinFast continues making losses around the globe, making huge losses as the company aggressively expands internationally. Setting up the brand, distribution network and post-sale services in India will need a lot of money.

Additionally, India is one of the most price-sensitive automobile markets in the world, and some foreign companies such as Ford and General Motors have not been able to sustain their operations due to huge investments.

The competition will be tough since several Indian companies like Tata Motors, Mahindra, MG Motor, BYD, Hyundai and Maruti Suzuki will continue aggressively targeting electric mobility opportunities. Therefore, VinFast will operate in one of the most competitive electric vehicle markets in the world.

Conclusion: India’s EV War Is Entering a New Phase 

The entry of VinFast into India signifies much more than yet another foreign car company’s launch in the country. With an initial investment commitment of around Rs 4,300 crore to Rs 4,700 crore, along with an ambitious investment roadmap which might even increase to Rs 19,000 crore and a mobility ecosystem using Green SM, VinFast intends to stake its claim in one of the most rapidly growing EV markets in the world.

Even though Tata Motors, Mahindra, and Ola Electric have certain advantages in terms of size, name, and distribution, the Indian EV market is still at a nascent stage, and the leaders continue to change. However, with successful localisation of its manufacturing processes, competitive pricing of its products and leveraging Green SM for creating demand, VinFast has the potential of being one of the greatest disruptors in India’s EV mobility space. It might not just be about the competition among domestic players but also the start of an entirely new global battle involving a new player from Vietnam.

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