Vietnam’s Elon Musk challenger turns heads in 2023

By Reuters   December 21, 2022 | 03:36 am PT
Vietnam’s Elon Musk challenger turns heads in 2023
Le Thi Thu Thuy, vice chairwoman of the Vingroup and VinFast Global CEO, speaks during the unveiling of a line of electric SUVs at CES 2022 at the Las Vegas Convention Center in Las Vegas, Nevada, U.S. January 5, 2022. Photo by Reuters/Steve Marcus
Vietnam is an unlikely home of the next Elon Musk. That’s why Le Thi Thu Thuy is one person to watch in 2023. The 48-year-old is at the wheel of VinFast, a money-losing electric-vehicle maker racing the U.S. entrepreneur’s Tesla on Western roads. It’s a complicated route.

VinFast has made its name selling gas guzzlers in the Southeast Asian nation, where its parent Vingroup is the top conglomerate. Now Thuy is heading in an entirely new direction by turning the carmaker fully electric, and by taking its brand global. Within a year, she plans 70 showrooms across the United States, Canada and the European Union to sell cars like the VF9 sports utility vehicle, which is priced at $76,000, around 15% more than Tesla’s comparable Model Y.

The former Lehman Brothers investment banker is leaning on sophisticated suppliers like battery-maker Contemporary Amperex Technology and electronic products-outfit Aptiv rather than counting on VinFast to develop proprietary technology. It is building a local factory in the United States too, something that’s hard for Chinese auto rivals like Nio and Xpeng to replicate as tensions fester between Washington and Beijing. An expensive marketing campaign is starting to yield results: VinFast reported 58,000 reservations as of December.

A planned initial public offering in New York is key to fund the expansion. Thuy must convince investors that the company isn’t desperate for money. Hanoi’s crackdown on the real estate sector is a drag on the property-heavy Vingroup. That makes it look like VinFast has a weak parent at a time when the auto business is also deep in the red: its net loss almost doubled to 34.5 trillion dong ($1.48 billion) in the first nine months of 2022.

Yet accessing Vietnam’s stock market is tricky and, to date, only nine Vietnamese companies have listed overseas, raising less than $1.5 billion in total, Refinitiv data shows. VinFast’s listing would, therefore, present a rare opportunity to tap an economy the International Monetary Fund expects will grow 6.2% in 2023. Thuy can at least count on a scarcity premium to fuel her big drive.

Context news

Vietnamese electric-car maker VinFast is planning a U.S. initial public offering, an initial prospectus published on Dec. 6 shows.

VinFast reported a net loss of 34.5 trillion dong($1.48 billion) for the nine months to the end of September, against 18 trillion dong for the same period a year earlier. Revenue fell to 10.5 trillion dong, down from 11.2 trillion dong.

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