Vietnam’s EV boom: VinFast buys first, mass adoption follows
Domestic brands lead Vietnam’s EV market despite intense competition and limited government incentives
[HO CHI MINH CITY] Vietnam is enjoying its position at the top as one of Asia’s biggest success stories amid the revolution in green transportation.
The country’s rapid adoption of electric vehicles (EVs) has been driven in large part by the strong performance of various home-grown EV brands, led by VinFast – the manufacturer founded by the country’s richest man, Pham Nhat Vuong.
In the first nine months of 2025, VinFast led the market, selling over 100,000 electric cars, which accounted for just over a quarter (about 27 per cent) of Vietnam’s total four-wheeler sales during that period.
This momentum was built on last year’s strong performance. Within the region, data compiled by the International Energy Agency (IEA) shows that electric car sales grew by nearly 50 per cent and accounted for 9 per cent of all car sales in South-east Asia in 2024.
Vietnam came in at 17 per cent, ahead of peers such as Thailand (13 per cent), Indonesia (7 per cent) and Malaysia (4 per cent).
In the electric two-wheeler space, Vietnam recorded a sales share of close to 10 per cent last year, significantly higher than Indonesia (1.6 per cent), Thailand (1.2 per cent) and Malaysia (0.6 per cent).
This was fuelled by the ongoing release of more affordable electric two-wheelers from domestic players such as VinFast and Pega, alongside the Chinese makes, IEA noted.
In the first nine months of 2025, VinFast alone sold 234,536 e-scooters and e-bikes, making up about 10 per cent of the 2.4 million units in total motorbike sales, MotorCycles Data estimated.
Pedal to the metal
VinFast is playing a key role in driving this adoption.
The top three best-selling cars in Vietnam in the first three quarters of this year were VinFast models, and about one in two electric motorbikes on Vietnam roads came out of the company’s production lines.
Truong Bui, partner at Munich-headquartered strategy consulting firm Roland Berger, said: “As a home-grown brand, it creates a deep national pride and consumer trust. Buyers recognise VinFast not only as a mobility provider, but also as a pioneer shaping Vietnam’s nascent EV industry.”
VinFast was founded in 2017 and initially manufactured internal combustion engine (ICE) vehicles. It entered the EV sector in 2021 and turned into an EV pure-play manufacturer in late 2022.
Its electric car sales went through a boom in 2023, surging nearly four times year on year to 34,855 units. The growth can be attributed to an unconventional playbook that Vuong – also the chairman of Vietnam’s largest private conglomerate, Vingroup – crafted to make VinFast dominant in the domestic market.
Described as “I buy first, you buy later”, the strategy entails VinFast’s affiliate companies – mostly backed by Vuong himself – buying and using the cars first, and swiftly investing in the related infrastructure.
VinFast’s earnings reports in 2023 indicated that 72 per cent of its car deliveries and 46 per cent of its scooter sales – over 25,000 and 33,000 units, respectively – were to related parties. Such sales were mainly to GSM, founded by Vuong in 2023 as the operator of the electric taxi brand Xanh SM.
Meanwhile, V-Green, also set up by Vuong, has installed 150,000 charging ports across the country. The figure is about nine times the number of the country’s petrol stations. The goal is to scale up to 500,000 ports in the next three years, and add another 150,000 battery-swapping cabinets; these facilities are exclusive to VinFast vehicles and provide free battery charging until mid-2027.
Amid growing consumer demand for EVs, VinFast has moved into the second leg of its strategy – aggressively offering its diverse product portfolio, which is tailored to Vietnamese consumer preferences, at competitive price points.
Priced at around US$11,300, the VF3 is VinFast’s most affordable model and remains one of its blockbuster cars. With over 31,000 units sold in the first nine months of this year, the mini EV is Vietnam’s best-selling car, surpassing the longstanding dominance of Japanese and Korean brands such as Toyota, Mitsubishi and Hyundai.
These tactics have paid off in a big way. VinFast sales share to related parties declined to 22 per cent in cars and 13 per cent in two-wheelers in the first six months of this year, reflecting the growing EV take-up of Vietnamese consumers.
VinFast EVs are now integrated into Vingroup’s sprawling ecosystem in Vietnam. From daily commutes to VinSchool, weekend trips to Vinpearl resorts, or occasional checkups at Vinmec hospitals – Vietnamese people can choose to travel in a VinBus, book a Xanh SM electric taxi, or own a private VinFast car or motorbike. They can also relax indoors while charging their vehicles at any of the hundreds of Vinhomes residential complexes and Vincom malls.
“This ecosystem approach, supported by Vingroup’s financial strength, provides VinFast with built-in demand and brand visibility,” said Koketso Tsoai, analyst at BMI.
Regional expansion risks deeper losses
While direct government financial incentives for EVs in Vietnam remain limited relative to those for its regional peers such as Indonesia and Thailand, VinFast has compensated for this by offering registration fee waivers, upfront price discounts, free charging, instalment and flexible battery subscription plans.
“These are specifically tailored to Vietnam’s lower-middle-income demographic,” said Akshay Prasad, principal at Arthur D. Little. “It also means VinFast is absorbing some of the cost, so the future plausibility of such a strategy is under question, but for now, it is being sustained.”
Hanoi and Ho Chi Minh City are planning ICE motorbike restrictions in the coming year. BMI’s Tsoai believes this will accelerate demand for electric two-wheelers, providing VinFast and other home-grown e-bike makers such as Pega, Dat Bike and Selex with a regulatory tailwind in their core domestic market.
“However, the biggest challenge remains balancing the high costs of global expansion and scaling with disciplined cost management and operational leverage,” he noted.
VinFast targets break-even by the end of 2026, even though its net loss was US$3.2 billion in 2024 and US$1.5 billion in the first half of this year.
The Vietnamese carmaker is replicating its playbook in South-east Asian markets such as Indonesia and the Philippines; sister company GSM is following the same expansion plan by quickly rolling out ride-hailing and taxi services overseas.
Separately, e-bike manufacturing rivals Dat Bike and Selex are also mulling plans to expand to regional markets in the coming years.
Prasad warned that these players may be caught in intensified price wars as South-east Asian two-wheeler EV markets are price-driven and flooded with Chinese imports, compounded by challenges such as high market entry costs and the need for distribution subsidies.
“VinFast and peers lack the local identity advantage they enjoy in Vietnam,” added Prasad. “Regional expansion is a growth imperative, but carries a high risk of continued losses without deep localisation.”
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