VinFast Aims For 100,000 EV Sales In 2024, Eyes Asian Market Expansion

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A Vietnamese electric vehicle manufacturer that has entered the US market is aiming to enhance its competitiveness in other markets to expand its scale, particularly in untapped, high-volume markets like Indonesia and India.

The Vietnamese electric vehicle manufacturer VinFast reported its fourth-quarter and full-year results for 2023. The company sold a total of 34,855 electric vehicles (including cars and e-buses) in 2023, which is a 374% increase compared to the previous year. In the fourth quarter alone, it sold 13,513 electric vehicles, a 35% increase from the third quarter of 2023. Although there was a slight decrease in e-scooter deliveries in the fourth quarter compared to the third quarter, the year-on-year growth for e-scooters was 48%, with a total of 72,468 units delivered in 2023. VinFast’s revenue for the fourth quarter of 2023 was $437 million, a 26% increase from the previous quarter and a 133% increase year-over-year. The total revenue for the fiscal year 2023 reached $1,198 million, a 91% increase from 2022. The gross loss for the fourth quarter of 2023 was $174.9 million, and for the full year, it was $551.6 million.

VinFast aims to deliver 100,000 vehicles in the calendar year 2024, supported by a larger distribution network and favourable macroeconomic conditions. The company has seen encouraging signs in early 2024, especially in California, where its direct-to-consumer approach has led to a significant increase in orders in January and February. VinFast’s global expansion strategy for 2024 includes entering markets like Indonesia and India and building on its foundation in the US, Canada, and several European countries.

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Madam Thuy Le, Chairwoman of the Board of Directors at VinFast, stated that 2023 was a year of significant milestones for the company, including a strong public debut, new product launches, and expansion into new markets. These achievements have set the stage for global expansion and cost optimization in 2024. The company is targeting the delivery of 100,000 vehicles in 2024, driven by positive signs in key markets and a recovering consumer sentiment.

Ms. Anh Nguyen, Chief Financial Officer, highlighted the strong revenue growth and improved profit margins in the fourth quarter. VinFast is focusing on enhancing investment performance and strengthening its balance sheet by reducing production and materials costs and optimizing global manufacturing capital expenditures. These initiatives aim to support expansion into high-growth markets like Indonesia and India.

In 2023, VinFast accelerated its expansion efforts with a multi-pronged strategy to scale its commercial footprint, product offerings, and manufacturing capabilities. The company introduced four new SUV models in Vietnam, including the flagship VF 9 model, VF 5, VF 6, and VF 7. In the fourth quarter, VinFast shifted from a capital-heavy, direct-to-consumer distribution model to a capital-light hybrid model, focusing on leveraging existing distribution infrastructure and building a dealership network in the US and globally. VinFast now has 13 stores and service centres in California and 6 new dealers in 5 states – New York, Texas, Kansas, Florida, and North Carolina – and has an additional 75 dealers under the application. The company expects to reach approximately 130 points of sales in North America and 400 globally by the end of 2024.

In 2024, VinFast aims to balance revenue growth with cost optimization through optimized production and materials costs and strategic investments in promising markets closer to Vietnam. The company plans to broaden its distribution channels through leveraging the local network and expertise of third-party dealerships and distributors. Its entry into the US market has strengthened its ability to compete effectively in other markets, especially the untapped, volume-driven Asian markets.

At the Indonesia International Motor Show (IIMS), VinFast announced its entry into the Indonesian market with the right-hand-drive VF 5, VF e34, VF 6, and VF 7 models. The company also signed memorandums of understanding (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 in one of the fastest-growing global economies. Just over a month after signing an MoU with the government of Tamil Nadu, India, VinFast announced the groundbreaking ceremony on February 25 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.

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