With a pair of deadlines looming, North Carolina is suing to try to regain control of a nearly 2,000-acre Chatham County economic development site from VinFast.
The suit alleges that the Vietnamese electric vehicle manufacturer won't be able to have its planned car manufacturing facility open by July 2026 or employ 1,750 people at the Moncure site by the end of this year.
Those deadlines are both part of an option built into the state's sales agreement for three parcels that make up the megasite. By failing to meet them, the state says it should be able to re-purchase the site.
And if neither of those arguments are persuasive, North Carolina officials are also pointing to a clause in their agreement with VinFast saying that "vertical construction" on buildings and structures needed to begin by Jan. 1, 2024. The state is alleging that while VinFast has graded the site and poured some concrete, nothing has been built above ground.
“VinFast agreed to build a factory and create jobs for North Carolinians – it didn’t do either. When North Carolina makes a deal, we build in protection for taxpayers. VinFast broke the deal, so we’re using that protection to find a project for this site that will create jobs," Attorney General Jeff Jackson, a Democrat, wrote in a statement.
VinFast has said publicly that it could open the factory by 2028, two years after the deadline in its agreement with North Carolina.
State officials wrote in their lawsuit that they did not agree with that timeline and are skeptical that VinFast would even be able to meet that target. And even if VinFast could meet that target, they argue, it falls outside of the maximum 18-month "cure" period the state is able to grant the company to offer it a chance to come in compliance with their agreement.
State officials also allege that while VinFast cleared the site of trees in 2023, it stopped any further work there in December 2024.
"VinFast has failed to take any concrete action that shows it can and will fulfill its obligation to the State. VinFast abandoned work on the site for over a year. Not only did the Company fail to create jobs — it made zero progress towards the construction of any buildings or structures," says the lawsuit, which was filed Thursday in Wake County Superior Court.
A request for comment sent to VinFast's general communications portal was not returned Thursday afternoon.
VinFast was founded in 2017 and quickly looked to open a factory in the United States. When the Chatham County factory was announced in 2022, VinFast said it expected to finish the first phase by 2024.
At the time of the 2022 announcement, VinFast was the largest economic development project in North Carolina history. VinFast said it planned to invest $4 billion and employ 7,500 people. The site would feature not only a car factory but also a bus manufacturing facility and an electric vehicle battery production plant.
'Time has run out'
VinFast's agreement with North Carolina required that it start constructing vertical buildings on its first phase by January 1, 2024. That has not happened, say North Carolina officials.
When North Carolina officials have asked VinFast for proof of vertical construction, the suit says, VinFast has sent photos of concrete footers being poured or retaining walls instead of anything showing free-standing structures built above ground.
"VinFast has never provided photos of any upright columns or vertical structures built into the building footers," the lawsuit states.
North Carolina officials argue that even finishing a foundation for the facility would require hundreds more footers to be poured.
"VinFast cannot begin vertical construction of a manufacturing facility until it has completed the underground foundation of the building. The company has yet to advance beyond the preliminary stage and has now run out of time to do so," the lawsuit states.
Beyond that, VinFast has never actually been issued a building permit. Chatham County was poised to do so on May 29, 2024, the suit says, but required VinFast to inform the county which contractors would be working on the site.
The company never responded to that request.
The January 1, 2024, deadline is important to the new lawsuit, North Carolina officials argue, because a potential 18-month "cure" period offered under the agreement between the state and VinFast has already lapsed.
In a new building permit application for a foundation submitted to Chatham County on March 6, VinFast reduced the scope of the project. The application said the facility would cover about 236 acres of the site and be built to employ 1,400 people.
That projected employment, which is for the fully built out project, is fewer than the 1,750 people VinFast's agreement with North Carolina says it needs to employ at a manufacturing facility on the site by this year.
“VinFast has not fulfilled its commitments. Today’s action is about protecting taxpayers and getting the Chatham County mega-site back on the market to support future good-paying manufacturing jobs," Governor Josh Stein, a Democrat, said in a written statement.
Trying to claw back $80 million
As part of the economic development package, the N.C. General Assembly appropriated $450 million of taxpayer dollars to the project for site preparation. That included up to $125 million to VinFast, as well as up to $250 million to the N.C. Department of Transportation and up to $75 million to the City of Sanford for water and sewer extensions to the site.
But the site development agreement that outlines how that money is supposed to be used says that if construction halts for at least a year, the state can claw back any funds it sent to VinFast.
North Carolina is now alleging that VinFast failed to do anything at the site for a full calendar, meaning that the state can claw back about $80 million it sent to the company for grading and other site preparation.
As proof, the suit points to Clayco, the company's previous contractor, Clayco, terminated its contract with VinFast on June 28, 2024, due to delays from the company and its failure to prove that it had the financing to build the manufacturing facility. In a lawsuit, Clayco officials would later allege that while they were contracted to perform construction, the facility's design was only 50% complete in June 2024.
That was followed in December 2024 with VinFast
