Vietnamese EV maker VinFast surges (then slides) as it screeches into a packed market
VinFast & furious… Shares of electric-vehicle maker VinFast more than tripled following its Tuesday SPAC debut on the Nasdaq, accelerating its valuation past GM and Ford. VinFast became the first Vietnamese automaker to sell cars in the US in March; it has just one ~$50K crossover available for Stateside sale, with one larger SUV confirmed. But investors’ were stoked by its lofty ambitions:
VinFast delivered its first EVs in 2021, and founder Pham Nhat Vuong (Vietnam’s wealthiest person) predicted his company is going to sell between 45K and 50K cars this year and 750K by 2026 — a # that took Tesla 17 years to hit.
Vuong hopes for profitability after 2025. To get there, VinFast plans to leverage low operating costs in its Vietnam home base while ramping up production with a North Carolina factory.
Vin some, lose some… VinFast’s share price fell by ~19% from its Tuesday peak as of the market’s bedtime yesterday. Other SPAC-quisitions haven’t turned out so spectacular: this year’s SPAC-listed companies slid a median 45%, while SPAC’d EV startups including Lordstown Motors, Nikola, and Faraday Future have lost 90%+ of their value since going public.
Low float: VinFast’s volatility may be partly due to few of its shares being available to the public — 99% are held by Vuong’s wife and his mega-conglomerate, VinGroup.
The EV market’s a tight parking spot… VinFast may struggle to maneuver its way in as established players churn out more models and slash prices. VinFast has the added challenge of proving its mettle as the first Vietnamese car company in the US, and it’s off to a rocky start. Its only model for sale in the US, the VF8, has gotten negative reviews (like “return to sender”) and costs ~$7K more than Tesla’s Model Y after subsidies.