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Hi Dima - I wanted to ask a quick question because I ran into a similar issue before. Does the VM name in vsphere match the hostname of the node? As for the cloudbase-init issues you are running into, I would suggest building templates with using packer with this: https://github.com/vmware-samples/packer-examples-for-vsphere it should have mostly everything you need and you can modify where needed. (adding a step to install containers should be all you need as a prereq.

Yep, name in rancher is different with vmware

@full-boots-81771 this will need to match exactly with the hostname of the VM. At least that was my experience. Otherwise the vsphere-cpi cant identify the node its looking for. Try naming the VM the exact same as the hostname and see if you get a different result.