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Elon Musk’s SpaceX and Suppliers Bet Big on Vietnam
This article discovers how Elon Musk’s SpaceX is investing US$1.5 billion in Vietnam to expand Starlink satellite services, with suppliers like Wistron NeWeb Corporation enhancing the country’s role in global high-tech manufacturing.
Vietnam is rapidly emerging as a major destination for high-tech investment, attracting global corporations seeking to expand their supply chains and production capabilities. Among these, Elon Musk’s SpaceX and its suppliers have announced multi-billion-dollar investment plans in Vietnam, focusing on satellite internet infrastructure and advanced manufacturing. This development aligns with Vietnam’s digital transformation initiatives, reinforcing the country’s role in the global supply chain for aerospace, telecommunications, and AI-driven industries.
Vietnam’s favorable investment climate, strategic geographic location, and improving regulatory environment have positioned it as a preferred hub for foreign direct investment (FDI). SpaceX’s expansion plan, which includes a US$1.5 billion investment, and its supplier Wistron NeWeb Corporation’s additional US$30 million commitment, signify growing confidence in Vietnam’s high-tech manufacturing. This article explores the economic implications, supply chain restructuring, and policy adjustments enabling these investments.
SpaceX’s investment strategy and Starlink expansion
SpaceX has identified Vietnam as a high-growth market for its Starlink satellite internet service, which aims to provide satellite internet services in Vietnam, particularly in remote and underserved areas. The company, led by Elon Musk, has already launched 6,000 satellites, covering nearly the entire globe. SpaceX’s Vice President Tim Hughes has engaged with Vietnamese government officials, discussing the regulatory framework required for Starlink’s commercial launch.
Vietnam currently faces connectivity gaps, with over 1,500 villages classified as having weak or no internet access. To bridge this digital divide, Vietnamese Prime Minister Pham Minh Chinh has directed the Ministry of Science and Technology to accelerate the approval process for Starlink’s satellite internet services. If successful, SpaceX’s high-bandwidth, low-latency connectivity solutions could enhance education, healthcare, disaster response, and business operations across rural Vietnam.
Supply chain shift: SpaceX suppliers relocate to Vietnam
Alongside SpaceX’s direct investment, its key suppliers are relocating production to Vietnam, reflecting a broader trend in supply chain diversification. Taiwan-based Wistron NeWeb Corporation, a SpaceX component manufacturer, is investing an additional US$30 million into its Neweb Vietnam subsidiary, which began operations in 2021 with an initial investment of US$60 million.
Wistron NeWeb’s facility in Ha Nam Province, covering 11.3 hectares, manufactures satellite communication devices, mobile equipment, and smart home products. The expansion aims to double production capacity, enabling Vietnam to become a critical manufacturing hub for SpaceX’s Starlink infrastructure. The move follows a broader shift, as suppliers such as Universal Microwave Technology and Shenmao Technology reduce dependence on Taiwan-based production and scale up Vietnamese operations, reinforcing Vietnam’s role in SpaceX suppliers.
Read further: Satelitte Internet in Vietnam: Insights into SpaceX’s Starlink Expansion
Current legal requirements regulate Starlink’s entry into the Vietnam market
Satellite internet is a new telecommunications technology trend that brings hope for increasing connectivity in countries like Vietnam. However, companies like SpaceX must meet specific legal requirements to gain access to the market.
Compliance with Vietnamese laws and international commitments
According to Vietnam’s Law No. 24/2023/QH15 on Telecommunications, Internet service providers must adhere to Vietnam’s laws and its international commitments that Vietnam is a member of.
Partnership with Local Businesses
Under the present legal framework, companies such as SpaceX are required to collaborate with a Vietnamese firm (like Viettel, VinaPhone, or MobiFone) to obtain a license for satellite internet services. They can also establish a commercial partnership with a Vietnamese telecommunications provider that holds a license and utilizes satellite transmission. As of now, VNPT is the sole organization in Vietnam that has a satellite information network.
Regulatory changes paving the way for investment
Vietnam’s draft regulations on foreign satellite internet services, expected to be approved by Parliament, have played a crucial role in attracting SpaceX’s Starlink project. The new pilot scheme, running until 2030, will allow full foreign control of operations for companies deploying low-orbit satellite networks.
This policy shift is seen as an “olive branch” to U.S. companies, particularly amid concerns over potential tariff measures from the Trump administration. By enabling Starlink’s entry, Vietnam aims to balance trade relations with the U.S., while accelerating its digital transformation goals.
Investment Capital Constraints
When forming a joint venture, SpaceX also needs to ensure that the capital contribution ratio is consistent with the provisions of Vietnamese law and international treaties. In any joint venture, foreign investment is limited to up to 49 percent of the legal capital per Vietnam’s international agreements. Nevertheless, under Vietnamese law, SpaceX can only hold a maximum of 20 percent of the charter capital or shares in the joint enterprise.
Sustainable Development Compliance
Beyond investment laws, SpaceX must also ensure compliance with additional regulations that promote sustainable development, protect user rights, and ensure information security and network safety.
Gateway Station Requirement
According to a recent draft decree by the Ministry of Information and Communications, foreign companies providing satellite telecommunications services must establish a gateway station in Vietnam to mitigate data loss risks and network safety issues and protect user rights within Vietnam.
Economic impact and FDI inflow trends
Vietnam’s digital infrastructure and connectivity have expanded rapidly, creating a strong foundation for foreign investment. As of early 2025, the country recorded 127 million active cellular mobile connections, surpassing the total population at 126 percent penetration.
Internet penetration in Vietnam has also reached a high level, with 79.8 million individuals using the Internet at the start of 2025, equating to an online penetration rate of 78.8 percent. Additionally, Vietnam has a robust social media presence, with 76.2 million social media user identities in January 2025, representing 75.2 percent of the total population.
The influx of high-tech investments from SpaceX and its suppliers is expected to boost Vietnam’s FDI inflows, further strengthening the country’s position as a regional manufacturing powerhouse. Vietnam has consistently ranked among the top FDI destinations in Southeast Asia, attracting over US$18.5 billion net inflow in 2023. The latest capital commitments from SpaceX and its network of suppliers will contribute to sustained economic growth, job creation, and technology transfers.
Challenges and considerations for investors
Despite the favorable investment climate, foreign investors in Vietnam must navigate regulatory complexities, infrastructure limitations, and geopolitical risks. Key challenges include:
- Regulatory approval processes: While Vietnam is opening up to foreign-controlled satellite internet services, securing full regulatory approval for Starlink’s commercial deployment remains a work in progress;
- Supply chain dependencies: Most primary materials for Wistron NeWeb’s Vietnam operations are currently sourced from China, posing potential risks related to logistics costs and trade tensions;
- Competition from regional hubs: Vietnam faces competition from Thailand, Malaysia, and Indonesia, which are also attracting high-tech manufacturing investments.
To mitigate these challenges, investors are advised to closely monitor policy developments, engage with local stakeholders, and leverage Vietnam’s special economic zones (SEZs) for tax incentives.
Future outlook
The integration of satellite internet services, AI-powered telecommunications, and aerospace engineering into Vietnam’s manufacturing and digital transformation agenda will pave the way for enhanced technological innovation, job creation, and economic resilience. With continued policy support and infrastructure enhancements, Vietnam is set to become a key player in the evolving landscape of space technology, advanced manufacturing, and global connectivity solutions, cementing its position in FDI inflow Vietnam technology sector.
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Dezan Shira & Associates assists foreign investors throughout Asia from offices across the world, including in Hanoi, Ho Chi Minh City, and Da Nang. We also maintain offices or have alliance partners assisting foreign investors in China, Hong Kong SAR, Dubai (UAE), Indonesia, Singapore, Philippines, Malaysia, Thailand, Bangladesh, Italy, Germany, the United States, and Australia.
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