VinFast shows strong commitment despite facing many challenges

According to AP News Agency (USA), the Vietnamese electric car brand believes that it can confidently succeed everywhere if it conquers the fiercely competitive US auto market.

Many promises and also many challenges

On a global scale, total sales in the last two quarters are 19,562 vehicles, while the company has a goal of delivering 50,000 vehicles this year.

In an interview with AP, Ms. Le Thi Thu Thuy – VinFast Global General Director said that the US is a fiercely competitive market. However, VinFast is committed to accompanying the wave of countries making efforts to convert to electric vehicles to reduce emissions.

“Prioritizing the US market is a deliberate decision by VinFast, even though the company faces strict regulations here,” VinFast CEO said.

“We want to build credibility in this challenging market. Our reason is very simple, customers will trust VinFast if it is successful in the US market. To some extent, this will be a “stamp of confirmation” for VinFast’s success even though achieving this is not really easy,” AP news agency quoted Ms. Thuy as saying.
Regarding how to enter the US market, VinFast CEO shared: “We realize that the trend of converting to electric vehicles is happening faster than expected, so we need to join forces with our partners.” work. VinFast is currently focusing on working with distributors in the US and Canada to take advantage of their local market knowledge and experience.”

AP quoted Mr. Sam Abuelsamid, mobility analyst at Guidehouse Insights, saying that some car companies that have entered the US market before, such as Hyundai or Kia, have sold cars at cheaper prices or built their reputations. based on vehicle performance or design. “You must have something that makes you stand out from your competitors” – Mr. Abuelsamid said.

According to Mr. Abuelsamid, VinFast can reduce production costs to make car prices more competitive, but this will affect the company’s profits. “Establishing an automobile manufacturing company requires huge investment capital,” he added.

VinFast started producing its first car in 2019 at its factory in Hai Phong. Most car production steps such as stamping frames, doors, welding, painting… are performed by robots and supervised by engineers via screens before the car enters the testing stage.

AP also recalled the event of VinFast listing shares on the Nasdaq exchange in mid-August and noted that at many times, the stock value more than doubled to a peak of 82.35 USD/share.

America’s largest news agency said that VinFast affirms its strong commitment to the US market as it is building a multi-billion dollar electric vehicle factory in Southwest Raleigh, North Carolina and plans to open it. production next year.

Regarding upcoming plans, information from AP said that VinFast will begin delivering cars in Europe this year and is targeting new markets in Southeast Asia, India and the Middle East, and announced its investment. Invested 400 million USD for factories in Indonesia and India. The company also aims to expand to 50 markets globally in 2024.

“Vingroup is a solid backing for VinFast”

AP commented that VinFast’s strong development goal is considered consistent with Vietnam’s economic development plan by turning the auto industry into a pillar of the economy. The company’s factory in Hai Phong has an area of 335 hectares and was completed in less than 2 years, with a current capacity of 250,000 electric vehicles per year.

VinFast is a member company of Vingroup, a leading corporation in Vietnam founded by billionaire Pham Nhat Vuong, with revenue growth of more than 50 times in the period 2011-2022 to 5.5 billion USD.

Commenting on VinFast’s resources, Mr. Matthew Degen, senior editor at car research company Kelley Blue Book (USA), said that Vingroup is a solid backing for VinFast for upcoming plans.

Currently, some unbacked electric vehicle manufacturers are struggling to achieve the scale needed to become profitable. Even some companies such as Lordstown Motors (USA) declared bankruptcy in June this year. This month, Chinese electric vehicle company WM Motor also filed for bankruptcy.

As for VinFast, in a recent announcement, the company said it expected to receive an investment worth 1.2 billion USD from the Chairman of Vingroup and other shareholders in the next 6 months. VinFast hopes to achieve the necessary scale to ensure profits through car sales in the Asian market. The Vietnamese automaker will also build two factories in Indonesia and India, expected to go into production in 2026 with a capacity of 50,000 electric vehicles per year.

Regarding some opinions that VinFast has sold more than 7,000 electric vehicles to GSM taxi company, showing that the demand for personal electric vehicles in Vietnam is not high, AP cited Ms. Le Thi Thu Thuy’s response, emphasizing the company’s strategy. The company’s mission is to popularize electric vehicles to Vietnamese people, helping them easily access electric vehicles. “This is like switching from using a landline phone to a smartphone,” Ms. Thuy added.

Vietnam’s automobile market has great growth potential. Car sales in Vietnam are increasing steadily along with the development of the economy. According to the Vietnam Automobile Manufacturers Association, more than 500,000 vehicles will be sold in Vietnam in 2022, helping Vietnam rank 24th in the world in terms of sales.

In 2023, VinFast began delivering the VF5 Plus model in the Vietnamese market in April with a selling price of about 22,000 USD. The company also plans to launch a mini electric car model next year. Most recently, on October 11, VinFast announced the merger of VinES, a battery manufacturing company under Vingroup. VinFast expects that autonomous battery production will optimize production costs by 5% to 7% and control the production chain, increasing competitive advantage in the market.