VinFast aims to build factories in India and Indonesia, while anticipating a $1.2 billion cash infusion from its founder and others as the Nasdaq-listed electric vehicle producer hopes to reach 50 markets by the end of 2024.
Vietnam-based VinFast sold 10,027 EVs in the third quarter, it also said on Thursday night, up slightly from the second quarter’s 9,535, most of which went to founder Pham Nhat Vuong’s taxi company.
Vuong controls most of the 2.3 billion VinFast shares that are privately held. He will sell 46 million in the next six months to help raise the remaining $700 million or so that he pledged to give the loss-making automaker, according to a securities filing on Thursday. It said that in September he had already given $291 million to the company, which expects to receive another $500 million grant from parent Vingroup.
VinFast made history in August as the only Vietnamese corporation to go public in the U.S. What followed were “bizarre price fluctuations” in its share price, Owen Lamont, an analyst and former Yale finance professor, told Nikkei Asia. Since less than 1% of VinFast stock is traded, its share price multiplied by Vuong’s far larger holdings can give the company a particularly high valuation, at one point exceeding that of U.S. automaker Ford. VinFast closed at $8.50 on Thursday, compared to its peak of nearly $69 in late August.
The securities filing said VinFast has “optimized its capital expenditure plan” for manufacturing, which will save $400 million, to be divided roughly evenly for the first phase of two new plants.
“These savings are expected to be used toward building CKD factories in Indonesia, the most populous country in Southeast Asia, and India, the third largest auto market in the world, according to Nikkei Asia,” the company said.
“CKD” refers to cars that are completely knocked down, meaning VinFast is likely to ship such units from Hai Phong, Vietnam, and assemble them in India and Indonesia. It targets capacity of 50,000 EVs a year per facility, with production starting in 2026.
The manufacturer said in May it would sell EVs throughout Southeast Asia, in addition to Europe and Canada. This year it became the first Vietnamese company to export cars to the U.S., but they received poor industry reviews and it recalled the vehicles over a potential safety issue. It also produces electric motorbikes and buses in Vietnam.
VinFast is “switching toward a capital-light distribution model,” putting it on “an improved path to profitability” while being “well-positioned to expand in strategic markets such as Indonesia and India,” chief financial officer David Mansfield said.
