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Mar 25, 2024

Vietnamese automaker VinFast is poised to enter the Indian automotive market with a focus on the Battery Electric Vehicle (BEV) segment. However, the success of this strategic initiative is uncertain, given the significant challenges posed by the competitive landscape, the dominance of established players, and the cost-conscious nature of Indian consumers.

The Indian automotive market is extremely competitive and has seen international giants like General Motors and Ford exit after decades of operation. Even Toyota and Volkswagen have struggled to establish a significant presence. This competitive environment presents a formidable challenge for VinFast, a newcomer, to establish its brand and attract the value-seeking Indian consumer.

Moreover, VinFast will be entering a BEV market where local players are already established with Tata Motors expanding its offerings to a full line-up by the middle of this decade. Mahindra too is gaining a foothold and will be adding more BEVs to its product range. And, Maruti Suzuki, the market leader, is set to introduce BEVs by 2025. These companies benefit from a well-developed supplier base, enabling them to offer affordable BEVs and further intensify competition for VinFast.

With the construction of its manufacturing unit expected to be completed by 2026, VinFast’s market entry will thus coincide with the launch of BEVs by the major players.

Therefore, VinFast’s success in India will hinge on its ability to build a strong brand image and differentiate itself from the competition. As a new entrant, VinFast must navigate the preferences of highly cost-conscious buyers who are familiar with global automobile brands. The company’s strategic positioning will be critical in winning over customers in a market that values affordability, reliability, and brand loyalty.

Additionally, VinFast’s value proposition must be compelling enough to overcome brand loyalty towards established players. The company’s ability to offer innovative features, competitive pricing, and a strong after-sales service network will be key factors influencing consumer acceptance.

Given the competitive challenges and the brand-building efforts required, we project weak sales for VinFast in India. The forecasted sales of 1.5k units in 2026, with a gradual increase to 3.3k units by 2036, reflect our cautious optimism for VinFast’s growth in the Indian BEV market.

It is important to note that this sales outlook is based on our assumption of VinFast introducing four BEV models: VF e34, VF 5, VF 6, and VF 3. The success of these models will be influenced by their acceptance in the market, the pricing strategy, and the overall value proposition offered to Indian consumers.

In conclusion, VinFast’s foray into the Indian BEV market is a bold strategic move that will test the company’s ability to compete against established local giants and navigate a complex and cost-sensitive market. While there is long-term potential for growth, VinFast must overcome significant barriers to entry and consumer skepticism. Our low sales projections reflect the challenges ahead, but also the opportunity for VinFast to carve out a niche in the evolving Indian automotive landscape.

(GlobalData blog on March 19, 2024)

Mar 22, 2024

On March 21, Renault Group and its subsidiary The Future Is NEUTRAL announced that it will showcase circular economy progress at the ChangeNow Summit in Paris from March 25 to 27, 2024. They introduce a new remanufacturing activity for electric powertrain parts, offering customers affordable options (up to 30% cheaper) while reducing carbon dioxide emissions.

Renault Group's after-sales offer includes reconditioned electric motor, power electronics, and traction battery for various models like ZOE and Kangoo E-Tech. By 2024, they aim to produce over 3,000 reconditioned parts for electric vehicles at the Flins plant, France.

Renault Group builds an industrial ecosystem for circular economy solutions, focusing on vehicle lifespan extension, battery repair, and energy storage. This includes reconditioning used vehicles, battery diagnostics, and the reuse of batteries in energy storage projects. The Group also emphasizes parts recycling and material reuse.

The efforts align with Renault Group's targets of incorporating 33% circular economy materials into new vehicles by 2030 and achieving net-zero carbon footprint in Europe by 2040 and worldwide by 2050.

Based on Renault press release

Mar 20, 2024

Ford Motor Co. is delaying planned three-row electric vehicles similar in size to the Explorer and Lincoln Aviator as it focuses on smaller, more affordable EVs, according to people familiar with recent company plans.

The three-row EVs, planned to be built in Canada at Ford's future Oakville Electric Vehicle Complex, were expected to go on sale in early 2025, but Ford will instead launch an affordable EV on a small vehicle platform at the company's Louisville Assembly Plant as early as late 2026, one of the people said.

The UAW and Ford agreed as part of its 2023 labor contract to add a new EV product to Louisville before the deal expires in 2028, although they did not specify timing.

Ford is reportedly planning three models on the new smaller platform: a small SUV due to launch in late 2026 at around USD 25,000, a pickup and, potentially, a ride-hailing vehicle. 

While any kind of delay for the three-row EVs is unknown, Ford CEO Jim Farley has previously said that smaller, cheaper EVs are what is needed to compete in the U.S. EV market.

"What the customer has now said to us is, if you have [an EV] larger than Escape, it better be really functional or a work vehicle," Farley recently said. "But if you do the economics for a vehicle, let's say the Escape or smaller, it's totally different, it completely works.

(multiple sources on March 19, 2024)

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