JAKARTA - Vietnamese electric vehicle maker VinFast said it plans to raise its investment in Indonesia to as much as $1 billion as it scales up local production, according to its Indonesia chief executive.

The statement, which Reuters first reported this week, came as VinFast inaugurated its first manufacturing plant in Indonesia, in Subang, West Java. The factory has an initial capacity of 50,000 vehicles a year and has begun trial production. Full operations are expected in the first quarter of next year.

VinFast Indonesia chief executive Kariyanto Hardjosoemarto said the company has invested about $300 million so far and plans to expand capacity to as much as 350,000 vehicles annually. He said the total investment could exceed $1 billion if vehicle sales justify further expansion.

Indonesia is one of VinFast’s overseas manufacturing bases as the company pushes beyond Vietnam. It is entering a market dominated by Japanese carmakers, while Chinese brands have rapidly expanded their presence in electric vehicles over the past two years. VinFast remains a minor player in Indonesia, with limited brand recognition and small sales volumes.

Economic ties between Indonesia and Vietnam initially come from a relatively modest base. Bilateral trade stood at around $14 billion in 2023, according to official data, with both governments targeting $15 billion in the coming years. Jakarta mainly exports coal, palm oil, and iron and steel to Hanoi, while importing electronics, textiles, and processed foods.

Conglomerate company Vingroup, which owns VinFast, has previously planned a $3 billion investment in India’s Telangana region, with officials projecting up to 10,000 local jobs from the project.