Breaking Ground: Kim Long Motor Hue’s New Engine Manufacturing Plant
In a significant development for Vietnam’s automotive industry, Kim Long Motor Hue held a groundbreaking ceremony for its new engine manufacturing plant in the Chan May – Lang Co Economic Zone, Phu Loc district, Thua Thien Hue province. The event marked a pivotal moment, not just for the company but also for the country’s automotive sector, as it takes a step forward in realizing the government’s approved strategy for its development.
The ceremony witnessed the strategic partnership between Kim Long Motor Hue and YuChai (China), as they signed a comprehensive agreement to collaborate on engine production and manufacturing in Vietnam. This milestone holds immense importance for both companies and the nation’s automotive industry.
With a total investment of 260 million USD, the Kim Long Hue engine manufacturing plant will be developed in two phases. The first phase will focus on producing engines for the automotive industry, with a planned launch in the second quarter of 2025 and an impressive 90% automation. During this initial phase, the plant will prioritize the production and assembly of diesel, CNG, and electric motors, aiming to manufacture over 12,000 engines annually, with plans to increase capacity in subsequent years. The second phase will involve investing in the production of automotive bridges, gearboxes, and drive systems.
Notably, this is the first time Vietnam has acquired advanced technology to independently produce modern automotive engines and power other industries. This achievement brings the country a step closer to industrialization and modernization while also fulfilling the long-cherished dream of many Vietnamese generations.
The plant’s output is anticipated to cater not only to Kim Long Motor’s production needs and the domestic market but also to explore export opportunities to ASEAN, South Korea, and other markets. According to the Thua Thien Hue People’s Committee, the Kim Long Motors Hue assembly complex is a key project for the province. With initial successes, the investor is now working on adjusting the total investment to around 21 trillion VND. The project is expected to positively impact the automotive industry, attract investment in automotive auxiliary industries to the province, contribute to economic restructuring, increase local budget revenues, and create job opportunities for local workers.
According to the Ministry of Industry and Trade’s draft strategy for the development of the steel, automotive, dairy, and retail industries in Vietnam by 2030, with a vision towards 2045, there are currently 377 automotive enterprises in the country, including 169 FDI enterprises, accounting for 46.43%. The number of domestic manufacturers and suppliers in the automotive industry is still modest. There are 1,221 products in this industry, most of which are supporting industry products with medium and low technology content and small value in the automobile value chain.
Regarding localization, the Ministry of Industry and Trade also stated that the localization rate for passenger cars up to 9 seats remains low. The set goals are 30-40% by 2020, 40-45% by 2025, and 50-55% by 2030.
