Vietnamese electric vehicle manufacturer VinFast Auto has outlined a roadmap for reaching break-even in its home market by 2027, with management anticipating broader global profitability in the period following. The company’s strategy hinges on increasing domestic delivery volumes and aggressive international market penetration.
Domestic Momentum and Model Strategy
The company’s growth in Vietnam has been bolstered by the introduction of the VF 2 model. Priced at VND188 million (approximately $7,144.62), including the battery, the vehicle has seen significant consumer interest, securing roughly 29,000 orders within three days of its launch in early July. According to data cited in recent reports, VinFast delivered 115,916 vehicles in Vietnam during the first half of the year, representing a 72% increase compared to the same period in 2023.
Anne Pham, deputy chief executive officer of investment at VinFast, noted at the Bloomberg Sustainable Business Summit in Singapore that the company continues to see strong sales domestically. She also attributed a portion of the recent uptick in EV adoption to rising fuel costs linked to ongoing geopolitical tensions in the Middle East.
Financial Outlook and Global Expansion
Despite rising delivery numbers, the company faces financial headwinds. VinFast reported a net loss of VND28.1 trillion in the first quarter, a 58.9% increase year-over-year, as it continues to absorb high costs associated with its international expansion efforts. To address its balance sheet, shareholders approved a proposal on May 27 to transfer the company’s Vietnamese manufacturing facilities to a separate entity, a move projected to generate VND13.3 trillion in capital to reduce debt.
The manufacturer has set ambitious delivery targets, aiming for at least 300,000 global EV deliveries in 2026, following a target of roughly 200,000 units for 2025. Its international footprint is currently expanding through:
- Localized Manufacturing: The company has established facilities in India and Indonesia, with plans to deepen localized production in these regions.
- Market Entry: Recent expansions include the launch of the Green SM ride-hailing service in Kazakhstan and ongoing efforts to establish a presence in the Philippines.
- Strategic Partnerships: Management has indicated an openness to further acquisitions and partnerships to facilitate global growth.
Operational Challenges
The company’s international path has not been without friction. VinFast is currently involved in a legal dispute regarding a proposed manufacturing site in North Carolina. In May, the state filed a lawsuit alleging that the company breached agreements related to the project and seeking to reclaim the site. While Pham declined to comment on the specifics of the North Carolina facility, she stated that the company’s broader sales strategy for North America remains on course.
