The leaders of electric vehicle maker VinFast Auto Group on Oct. 5 reported third-quarter deliveries of a little more than 10,000 units and said they are focused on expansion plans as they gear up for an increased international presence in 2024.
“We are continuing to better our production capabilities in North Carolina and the facility will best position us to serve the North American market,” said CEO Thuy Le. “We are progressing in our evaluation of up to 50 other global markets we have identified as having high potential for us to engage with.”
Le and her team also are planning two assembly facilities for 2026 in India and Indonesia. Each is expected to have a capacity of 50,000 EVs during phase 1. VinFast vehicles will be available in Indonesia by 2024.
“We aim for our vehicles to be present in up to 50 markets and countries by the end of 2024,” Le said, adding that in the United States, it will mean “increased consumer access” in more states rather than a pure direct-to-consumer market. So far, she said the VinFast team has received 27 applications or letters of intent across 12 states and is in talks with 60 dealers covering 21 states. The first U.S. franchise is expected to open by the end of the year.
As of Sept. 30, VinFast ran 126 EV showrooms globally, up from 122 at the end of Q2. It managed to deliver 10,027 vehicles, a 5% increase quarter over quarter, bringing the total number of vehicles delivered in 2023 to 21,342. But in order to hit the low end of leaders’ guidance of 40,000 to 50,000 vehicles this year, the company will have to nearly double its year-to-date deliveries in Q4.
Many of VinFast’s deliveries are to Green SM (GSM), a Vietnamese EV taxi service/leasing provider also owned by Pham Nhat Vuong, chairman and founder of VinGroup, VinFast’s parent company. This year, the company has delivered 13,000 vehicles to GSM, approximately 6,000 of which were in Q3. There is no breakdown available of how many of those deliveries are for taxis and how many are intended for leasing customers.
Financially, VinFast incurred wide losses: Despite generating $343 million in revenue, its net loss was nearly double that at $623 million. It did manage to significantly reduce capital expenditures, which came in at $178 million, nearly half of what it was in Q2 and down 40% year over year.
“We reduced our spending on tools and equipment for new vehicle programs and front-loading battery purchases in connection with battery leasing,” CFO David Mansfield said of the drop.
Executives are still targeting breakeven profitability in the next two years and ended the quarter with $131 million in cash. According to a company press release, parent company VinGroup has disbursed nearly $1 billion in loans to VinFast this year, with another $500 million expected in the next six months. This is part of an agreement with the company where VinGroup will disburse a total of $2.5 billion to VinFast: $1 billion in grants from Vuong, $500 million in grants from VinGroup, and $1 billion in loans from VinGroup.
VinFast (Ticker: VFS) reported earnings before market open Oct. 5, when its shares opened at $8.09 per share after closing at $8.50 the previous day, bringing its market capitalization down to $18 billion. Shares of the company have been on a downward trend since its debut in August.