VinFast’s special case: Financial loss narrows despite slumping sales. Here’s how

And: Bloomberg
| Updated on: 17 Apr 2024, 17:25 PM

The first quarter loss of VinFast Auto Ltd. fell as auto sales slumped as the Vietnamese EV maker set ambitious goals to become a global brand in mid-December.

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The first quarter loss of VinFast Auto Ltd. declined as vehicle sales fell as Vietnam’s EV maker set ambitious goals to become a global brand as demand for electric vehicles dwindled worldwide.

In 2023, VinFast said 72 percent of its EV sales and 46 percent of e-scooter shipments were to related parties, mainly to taxi company GSM Green and Smart Mobility Joint Stock Co. (Bloomberg)

The first quarter loss of VinFast Auto Ltd. declined as vehicle sales fell as Vietnam’s EV maker set ambitious goals to become a global brand as demand for electric vehicles dwindled worldwide.

The company reported a net loss of $618.3 million in the first three months of this year, down 12.3 percent from the fourth quarter, the company said in a filing. Revenue for the period was $302.6 million, down significantly from sales of $436.5 million in the prior quarter but up 269.7 percent year over year.

VinFast, which said it aims to sell its cars in as many as 50 global markets by the end of this year, is launching its brand amid waning interest from electric car consumers. Tesla Inc. is cutting its workforce by more than 10 percent as China’s EV makers are locked in a price war as demand for the vehicles slows.

VinFast delivered 9,689 vehicles in the first quarter, a 28 percent drop from the previous three months. It delivered a total of 34,855 vehicles last year. The company confirmed its forecast of 100,000 vehicle deliveries in 2024.

Also read : VinFast’s Vingroup faces financial risks amid ambitious EV expansion plans

Fifty-six percent of VinFast’s first-quarter EV sales were to the company’s related parties, the company said. In 2023, VinFast said 72 percent of its EV sales and 46 percent of e-scooter shipments were to related parties, mainly to taxi company GSM Green and Smart Mobility Joint Stock Co., where Vingroup chairman Pham Nhat Vuong holds the bond. 95 percent of the stock.

VinFast shipped its first EVs to the United States in late 2022. It now has a network of 16 dealers in seven states, the company said. Ten dealers will start operations in the second quarter, it said.

VinFast is building a $2 billion manufacturing facility in North Carolina and broke ground on its electric vehicle manufacturing site in India’s Tamil Nadu in February while planning a factory in Indonesia.

VinFast, in an earlier filing, said it still plans to complete the main construction of the North Carolina industrial site by the end of 2025, and to complete the production processes shortly after that.

Date of First Publication: 17 April 2024, 5:25 PM IST

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