Tasco, China’s Geely form JV for vehicle assembly, distribution in Vietnam

Hanoi-based Tasco Joint Stock Company (Tasco) and Geely Auto Group (Geely), a top 10 global auto manufacturer, have signed a joint venture agreement for the manufacturing and assembly of automobiles in Vietnam.

At a ceremony on Monday, both parties also signed the distribution agreement of the Geely Auto brand following the distribution agreement with Lynk & Co in 2023.

They also inked a three-party memorandum of agreement on strategic cooperation with the Economic Zone and Industrial Parks Management Board of the northern province of Thai Binh.

This is an important event that continues to strengthen the relationship between Geely and Tasco, progressively realizing Geely’s market expansion plans in Southeast Asia and Tasco’s goal of advancing upstream in the automotive industry.

Specifically, the joint venture for car assembly between Tasco and Geely is a CKD (completely knocked down: assembly in Vietnam with imported components) project, with a designed capacity of 75,000 vehicles per year in phase 1, on a 30-hectare land area. This will serve the domestic market and, importantly, export to countries with free trade agreements with Vietnam.

Tasco and Geely will also collaborate to attract other investors to complete the supply chain for components and spare parts, invest in the construction of an automotive R&D center for Southeast Asia, establish a university for automotive technical training, and invest in the production of smartphones specifically designed for vehicle-human connectivity in the Tien Hai Economic Zone, Thai Binh.

The total investment for the project is estimated at approximately $168 million, with Tasco contributing 64% of the capital and Geely Group 36%. Initially, the joint venture will assemble vehicles under the Lynk & Co and Geely Auto brands, with the potential to expand to other brands in the future.

The plant is expected to break ground in the first half of 2025, with the first vehicle model delivered to customers in early 2026.

Alongside the CKD project, Tasco Auto – a member company of Tasco – will also officially become the distributor of the Geely Auto brand.

Geely Auto is a popular mainstream automobile brand known for high-quality vehicles at reasonable prices. In 2023, Geely surpassed its sales target with over 1.68 million cars sold, and in just the first eight months of this year, Geely achieved sales of 1.31 million units (including Zeekr and Ruilan), marking a 33% increase compared to the same period last year, aiming for 2 million units for the entire year of 2024 (excluding Volvo sales).

Following the success of distributing premium brands such as Volvo, Lynk & Co, and Zeekr, Tasco has officially been authorized to distribute the mainstream Geely Auto brand in Vietnam.

This helps complete the product range and diversify options for customers while affirming Tasco’s commitment to providing quality vehicles from top global brands to Vietnamese consumers.

During the event, Tasco and Geely Auto also signed a memorandum of agreement on strategic cooperation with the Economic Zone and Industrial Parks Management Board of Thai Binh province.

In the presence of local leaders and central government agencies, the three parties signed an agreement regarding projects that have been, are being, and will be implemented in Thai Binh, including the automobile assembly plant, R&D center, supply chain, auto training school for automotive technology, and more.

With significant advantages in economic development and attracting investment, such as government incentives, convenient transportation, and proximity to seaports, the cooperation plans of Tasco, Geely, and Thai Binh province are expected to bring substantial economic growth potential to the locality, as well as sustainable and comprehensive development for both enterprises.

Speaking at the event, Ngo Dong Hai, Secretary of the Thai Binh provincial Party Committee stated: "The strategic cooperation between Tasco and Geely in Thai Binh comes at a very opportune time. The Vietnamese automobile market is full of potential, with a car ownership rate of about 63 vehicles per 1,000 people compared to over 300 vehicles in Thailand.

“The market is expected to grow at an average annual rate of 14%-16% by 2030, with total car consumption reaching 1 to 1.1 million units, and by 2045, this is projected to increase to 4.5 to 4.7 million vehicles. Over the past 10 years, the growth rate of Vietnam's automobile market has been among the highest in the world," Hai said.

“Many important policies from the government to develop the automotive industry are being developed and will soon be passed, aimed at boosting production and increasing localization rates,” he added.

He went on to state: “We fully support this partnership, seeing its implementation as a commitment of the entire province, and we will do everything possible to ensure the strategic agreement between the two groups is a success, as reflected in the memorandum of understanding that has been signed. I hope that this three-way collaboration will achieve success in the long journey ahead."

The top management of Geely also stated: “This strategic cooperation project marks another important milestone in the globalization of Geely Auto Group. Today, we had the opportunity to engage in discussions with Deputy Prime Minister Tran Hong Ha and Central Party Committee member – Secretary of the Thai Binh Provincial Party Committee Ngo Dong Hai."

“We are highly appreciative that both the deputy prime minister and the secretary fully endorse the cooperation between the two groups and the investment project in Thai Binh province.

The executive added: “With the strong support of the Vietnam government, the Party Committee and the government of Thai Binh province, we will collaborate closely with Tasco Group to invest in and build a CKD assembly plant in the Tien Hai Industrial Economic Zone, Thai Binh.

“Together, we will establish an automotive research, production, supply, and service ecosystem in Thai Binh, creating a hub for the automotive industry, research, and the export of automotive talent in ASEAN.”

Vu Dinh Do, chairman of the board of directors of Tasco, shared: "The joint venture between Tasco and Geely marks a significant step forward not only in the automotive manufacturing sector but also in opening opportunities for the development of smart transportation infrastructure, applying connectivity and automation technology in Vietnam.

“We believe that this collaboration will enhance the quality of life by developing smart and connected transportation, while also facilitating the transfer of advanced technology, training a high-quality workforce, and boosting exports.

“It is also an opportunity for Tasco to learn from Geely's experience and adopt successful strategies, delivering modern, safe, and environmentally-friendly products to consumers.

“We particularly emphasize the choice of learning from experience and international cooperation to sustainably realize our vision and specific missions, contributing to positioning Vietnam on the global map of technology and the automotive industry," Do said.

Geely Auto Group expanding into Southeast Asia

Founded in 1986, Geely has grown to become one of the top 10 largest automobile manufacturers in the world, and the first Chinese car manufacturer to reach 10 million users, with a total of over 16 million customers across more than 80 countries and territories.

Geely invests heavily in research and development, especially in electric vehicles and autonomous driving. The group has established research and design centers globally in Sweden, the UK, Italy, and China, with over 30,000 R&D and design personnel, holding nearly 32,000 innovative patents. Geely operates world-class vehicle and powertrain manufacturing plants in China and has expanded its global sales and service network with more than 4,000 branches.

From January to August this year, Geely Auto achieved sales of 1.31 million vehicles (including Zeekr and Ruilan), up 33% compared to the same period last year, far exceeding the Chinese auto industry’s growth rate of 3.3%.

Notably, Geely's export sales in the first eight months of 2024 grew by nearly 70%, reaching 280,000 vehicles, reflecting the growing international market demand for Geely’s automotive brands. In 2024, Geely aims to achieve sales of more than 2 million vehicles, excluding Volvo sales.

In 2024, with over 50,000 employees worldwide, Geely ranked 185th on the Fortune Global 500 list (comprising the top 500 companies and corporations in the world), climbing 40 places compared to 2023. This marks the 13th consecutive year Geely has been included in this prestigious list.