VinFast’s income development is quick, however the electric-vehicle maker’s prices develop sooner.
Vietnam’s Tesla challenger is constructing a $2 billion manufacturing plant in North Carolina, is poised to interrupt floor on one other in India’s Tamil Nadu, and has yet one more planned in Indonesia.
This week, VinFast reported a net loss within the fourth quarter of $650.1 million, up 3.4% from the earlier quarter. For the complete 12 months, VinFast’s web loss reached $2.4 billion, up 14.7% from 2022.
However, income grew considerably, leaping 91% to $1.2 billion final 12 months from 2022, and the corporate plans to ship 100,000 vehicles this 12 months, up from practically 35,000 final 12 months.
VinFast is a part of Vingroup, a conglomerate led by Pham Nhat Vuong, Vietnam’s richest man. The carmaker launched in 2017, producing conventional gas-powered autos earlier than pivoting to EVs only 5 years later.
It started promoting its VinFast VF8 within the U.S. final March, however critics panned the car, citing inconsistent dealing with and poor efficiency.
Regardless of that, the corporate’s shares surged 504% over a six-day interval after its IPO in August 2023 on the Nasdaq. VinFast’s market cap briefly exceeded—earlier than a dramatic plunge—that of Ford, Volkswagen, and General Motors mixed.
From a peak of about $190 billion, the corporate’s market cap now stands at simply $11.7 billion.
One difficulty with VinFast shares has been that Vuong owns practically all of them, with solely about 2% presently out there for investor buy. This implies even tiny shifts in quantity can set off giant value actions. VinFast mentioned final month it plans to increase the shares out there to 10% to twenty% by 12 months’s finish.
VinFast isn’t alone in a struggling EV market
After all, VinFast isn’t the one EV maker struggling to show a revenue. Gross sales development of EVs, whereas nonetheless robust, is slowing within the U.S. and different markets.
This week, Rivian announced a disappointing fourth quarter and outlook, saying it might minimize its salaried workforce by roughly 10%. Tesla CEO Elon Musk mentioned his rival should “cut costs massively” to outlive, including: “Their product design is not bad, but the actual hard part of making a car company work is achieving volume production with positive cash flow.”
Even Tesla has warned of “notably lower” gross sales development this 12 months after a disappointing fourth quarter, and it was lately surpassed in world EV gross sales by China’s BYD. Backed by Warren Buffett’s Berkshire Hathaway, BYD may give VinFast complications. In Indonesia, Southeast Asia’s largest economic system, EVs from BYD are now competing directly against ones from VinFast.
“Chinese car companies are the most competitive car companies in the world,” Musk mentioned in Tesla’s newest earnings name, warning in regards to the Chinese language competitors. “If there are no trade barriers established, they will pretty much demolish most other car companies in the world.”
