Vietnam, Asian Development Bank awards $135 million financing to VinFast for e-buses and charging stations

The Asian Development Bank (ADB) awarded a $135 million climate financing package to VinFast. Goal? “Manufacturing Vietnam’s first fully-electric public transport bus fleet and first national electric vehicle (EV) charging network”, VinFast says.

The first electric buses with VinBus’ logo has been launched in Vietnam (Vinhomes Ocean Park, Gia Lam) in April 2021.

VinBus is a subsidiary of Vingroup and was established in September 2019. The company is focused on e-bus deployment, where the e-buses are to be produced by VinFast, another subsidiary of the same group, in Vietnam. The launch of this new Vingroup venture was accompanied with the announcement of plans for 3,000 e-buses in the country. Based on specifications released at that time, Electrive notes, “the buses boast a battery capacity of 281 kWh, capable of moving up to 220 – 260km. The Vietnamese vehicle manufacturer said the buses charge in 2 hours at VinBuss 150kW fast charging station system with charging technology provided by StarCharge”.

VinFast gets financing for manufacturing electric buses

The climate financing “comprises 7-year tenor financings, including a $20 million loan funded by ADB, parallel loans of $87 million facilitated by ADB as mandated lead arranger, and concessional financing of up to $28 million”, still manufacturer reports.

ADB has partially offset the project’s risks by utilizing concessional financing through its managed trust funds comprising loans from the Australian Climate Finance Partnership funded by the Australian Government (ACFP), the Clean Technology Fund (CTF) and a grant from the Climate Innovation and Development Fund, which is funded by Goldman Sachs and Bloomberg Philanthropies. Parallel loans were also mobilized by ADB from Export Finance Australia, the Finnish Fund for Industrial Cooperation, Oesterreichische Entwicklungsbank AG, and responsAbility.

Additionally, the project includes a technical assistance (TA) of $950,000 from the ACFP and the CTF, focused on raising consumer awareness about e-mobility’s economic, environmental, and social impacts to help advance its market penetration. The TA will also help promote the role of women studying for or working in fields related to science, technology, and mathematics.

“This project delivers a high-impact, sustainable transport solution for Vietnam while helping it meet its climate goals and supporting the growth of climate finance in the region,” said ADB Private Sector Operations Department Director General Suzanne Gaboury. “Asia and the Pacific is the frontline of the global fight against climate change, and private sector projects like this one with innovative partners such as VinFast are crucial to help its countries decarbonize their economies.”

“We are delighted to receive this extensive support and a long-term financing package from ADB and several esteemed international Development Finance Institutions. We see this as a vote of confidence in our efforts to become a global smart mobility company that offers environmentally friendly public transportation, and to advance Vietnam’s transition to a low carbon economy,” said VinFast’s Global CEO Thuy Le.