VinFast expands network despite losses

VinFast in its latest report said that the gross loss was about $175 million in the fourth quarter last year. It represents an increase of 13 per cent from the fourth quarter of 2022 and an increase of nearly 70 per cent from third part of last year.

The electric vehicle maker saw about $552 million-loss in financial year 2023, representing an increase of 7.3 per cent from the previous year.

Thuy Le, Chairwoman of the board of directors of VinFast, said: "2023 was a whirlwind of firsts for VinFast, culminating in a strong public debut. We launched exciting new products, expanded our distribution network, and solidified our presence in existing markets while opening doors to promising new ones.”

She also unveiled that the company already saw positive signs in key markets like the U.S. and Indonesia and it aims at delivering 100,000 vehicles this year.

In 2023, in terms of product launches, VinFast introduced four new SUV models in Vietnam across a number of segments.

In the last fourth quarter, it made an important pivot from the capital-heavy, direct-to-consumer distribution model to a capital-light hybrid model with a strong focus on leveraging existing distribution infrastructure by building a dealership network in the U.S. and globally.

VinFast’s gross profit margin showed significant improvement compared to the previous fiscal year.

Gross margin was negative (46 per cent) in 2023, compared to negative (82%) in 2022. It also created total revenues at about $1.2 billion, representing an increase of 91 per cent from 2022.

The total of electric vehicles VinFast delivered last year increases 374 per cent compared to the previous year, leading to an 133 per cent increase in revenues year-over-year.

In 2024, VinFast expects to reach approximately 130 points of sales in North American and 400 globally by the end of 2024, with sales through dealerships contributing a meaningful portion in the second half of the year.

The brand now has 13 stores and service centers in California and six new dealers in five states - New York, Texas, Kansas, Florida and North Carolina, and has had an additional 75 dealers under application.

To put more VinFast vehicles on the road, VinFast will broaden the distribution channels through leveraging the local network and expertise of third party dealerships and distributors, it stated.

Building awareness and success in high-profile markets like the US strengthens the company’s ability to compete effectively in other markets to build scale, especially the untapped, volume-driven Asia markets.

Earlier this month at the Indonesia International Motor Show (IIMS), VinFast announced its entry into the Indonesian market with the right-hand-drive models.

It also signed MoUs with three businesses at IIMS, solidifying its expansion in Indonesia and securing the delivery of a total of 600 electric vehicles.

In India, VinFast aims to seize the growth opportunities and market potential of the world’s most populous nation.

Just over a month after the signing of a memorandum of understanding with the Government of Tamil Nadu, India, VinFast has announced the groundbreaking ceremony for the integrated electric vehicle manufacturing facility in Thoothukudi City.

With a vision to become a leading regional electric vehicle manufacturing hub, the plant has a capacity of up to 150,000 electric vehicles per year when it officially goes into operation.