Geely’s Vietnam CKD Plant: Model for Chinese Automakers Going Global

Chinese automakers have been exporting to Southeast Asia for years. But exporting is not the same as committing. Geely announced a $168 million CKD plant in Vietnam’s Thai Binh province—30 hectares, 75,000 units annual capacity, set to begin production in early 2026. The facility will produce both Geely and Lynk & Co models, covering ICE, PHEV, and BEV powertrains. This is not Geely’s first overseas plant. But it signals a shift: from “selling cars” to “building local capacity” as the default strategy for accessing ASEAN and beyond.

Core Data

Item Detail Source

Total investment $168 million Geely + Tasco Auto announcement

Location Tien Hai Economic Zone, Thai Binh province, Vietnam Tasco Auto

JV ownership Geely 36% / Tasco Group 64% Tasco Auto

Land area 30 hectares Geely announcement

Production mode CKD (Completely Knocked Down) Geely announcement

Phase 1 capacity 75,000 units/year Geely announcement

Timeline Construction started H1 2025, production early 2026 Geely announcement

Brands Geely + Lynk & Co Geely announcement

Powertrains ICE / PHEV / BEV Geely announcement

First model Geely Coolray (Binyue) Geely announcement

Dealer network (partner) 24 outlets + 50 fast-charging stations (Tasco Auto) Tasco Auto

Planned service centers by year-end 80 (Geely Vietnam) Geely Vietnam event

In-Depth Analysis 1. Why CKD? The tariff logic behind local assembly Vietnam has free trade agreements (FTAs) with the EU, ASEAN, and other key markets. Under these agreements, goods with sufficient local content (typically 30–40%) qualify for preferential tariffs—sometimes zero. A CKD operation allows Geely to import components at lower duties (on parts, not whole vehicles), assemble locally, and potentially meet local content requirements. This transforms the factory from a Vietnam-only supply base into a regional export hub. The alternative—exporting fully built units from China—faces higher tariffs (e.g., EU’s anti-subsidy duties on Chinese EVs, currently up to 35%) and longer logistics lead times. CKD is not just a manufacturing decision; it’s a trade policy hedge. 2. Dual brands, one line: Efficient market segmentation Producing both Geely and Lynk & Co on the same line is a deliberate choice:

Geely brand: Targets the mass market. The Coolray (Binyue) is a compact SUV priced competitively. The newly launched EX2 (A-segment city EV, ~$2,000–2,200 USD equivalent) and EX5 EM-i (PHEV SUV) expand coverage.

Lynk & Co: Targets premium segments, higher margins, and brand-building.

By sharing the same assembly line, Geely keeps fixed costs low while addressing two distinct customer segments. This is the same logic Toyota used with Lexus—but executed from day one of local production. 3. Vietnam as a gateway: Beyond the local market Vietnam’s FTA network is the real strategic asset. Products assembled in Vietnam can enter:

ASEAN: Tariff-free within the bloc under ATIGA

EU: Preferential access under the EU-Vietnam FTA (EVFTA)

Other FTA partners: Including the UK, Japan, South Korea, and Russia

This means the Thai Binh plant is not just for Vietnamese buyers. It is a potential export base for right-hand-drive markets (Indonesia, Thailand, Malaysia) and even Europe—depending on how local content rules are satisfied. 4. What’s missing? Charging infrastructure remains a bottleneck Geely Vietnam acknowledged at the March 27 launch event that charging infrastructure is a key barrier for EV adoption. Partner Tasco Auto and Esky plan to build 55 charging stations by 2026. But 55 stations for a country of nearly 100 million people is a starting point, not a network. The pragmatic approach here is to prioritize PHEVs (like the EX5 EM-i) and ICE models initially, while building BEV volume gradually as infrastructure catches up. This is a phased strategy, not a flaw.

Industry Insights

CKD assembly in FTA-rich countries is becoming the default entry strategy for ASEAN. The tariff savings alone can justify the investment. But success depends on building local supply chains—not just importing kits. Geely’s 36% stake leaves room for local partners to lead, which reduces political and operational risk. As Chinese automakers set up CKD plants across Southeast Asia (Thailand, Indonesia, now Vietnam), demand for local component supply will grow. Suppliers with existing Southeast Asian footprint—or those willing to invest—will capture structural demand. If you are sourcing vehicles or components for Southeast Asian markets, monitor which automakers achieve genuine local content. The ones that do will offer better landed costs and trade resilience.

If you are following Chinese automakers’ global expansion, Vietnam is a case study in how trade policy and manufacturing strategy intersect. The next question: which brand will be the third to announce a Vietnam CKD plant? (Chery was first, Geely second.) If you need help navigating China’s automotive supply chain—whether for sourcing components, identifying local assembly partners, or understanding trade policy implications—reach out. I help global buyers connect with the right Chinese partners.