Vietnamese electrical car (EV) startup Vinfast is revving up for its debut in US public markets.
Vinfast filed with the Securities and Alternate Fee (SEC) on December 6. It has not introduced a date for the launch however plans to record on the Nasdaq beneath the ticker “VFS.” Although it didn’t disclose specifics concerning complete models or pricing, its submitting charge schedule indicated Vinfast goals to increase $100 million by the preliminary public providing (IPO).
Which may be a placeholder sum, although. Earlier experiences by Bloomberg estimated the corporate’s IPO may increase $2 billion after an preliminary confidential submitting with the SEC in April.
Based in 2017 by Vietnam’s richest man and first billionaire – Pham Nhat Vuon – Vinfast is predicated in Hai Phong Metropolis, a serious coastal metropolis within the nation’s northeast. It phased out all inner combustion autos this yr and now solely manufactures EVs. It produces battery-powered scooters and buses to enrich its lineup of electrical automobiles.
Vingroup is likely one of the nation’s largest conglomerates, proudly owning quite a few companies that cowl actual property, training, and shopper tech, together with Vsmart – one among Vietnam’s main smartphone manufacturers. Earlier this yr, Vingroup, and two of its publicly-traded subsidiaries, collectively made up virtually 30% of the worth of Vietnam’s inventory trade. The group’s income alone generates roughly 2% of the nation’s GDP.
Till now, Vinfast has predominantly been a home model in its dwelling market. Although Vinfast’s autos are at present produced in Haiphong, the corporate just lately broke floor at a $2 billion manufacturing unit web site in North Carolina and may have no less than 150,000 automobiles rolling off the meeting line there from July 2024 onwards. It plans to make use of the cash raised from the IPO to gasoline its worldwide growth additional. Though the deal is prone to occur in 2023, Vinfast goals to achieve a footing within the American market and begin promoting its automobiles in California earlier than the yr’s finish.
Vinfast’s preliminary EV product line options A- by E-segment electrical Sports activities Utility Car (SUV) fashions. It’s taking bookings for 2 electrical SUVs, its midsize VF8 and the bigger VF9.
The corporate is at present operating at a loss. Within the first three quarters of 2022, it generated $439 million in income, however with prices totaling $1.5 billion.
As an EV maker, Vinfast can also be weak to the continued semiconductor crunch. It needed to delay delivery its VF8 and VF9 fashions to Europe this yr, and will face comparable setbacks once more, relying on supply-side constraints.
EV Market Increase
The EV market within the US has seen speedy progress because the pandemic. In response to the US Division of Vitality, EV gross sales within the US grew by 85% from 2020 to 2021.
EV manufacturers are multiplying too. Apart from business chief Tesla, automakers similar to Ford, Basic Motors, Volkswagen, Lucid, Rivian, Polestar and Fisker compete fiercely for market share.
Vinfast would possibly threaten Tesla’s place by providing comparable automobiles at a a lot lower cost. Vinfast can also be working with established European auto manufacturers similar to BMW and Bosch to develop new fashions, which may make them extra aggressive when it comes to know-how and design.
If Vinfast can pull off an enormous IPO and set up a safe beachhead within the US market, it may doubtlessly give Tesla a run for its cash additional down the street.
In weighing up the IPO, buyers will doubtless think about how Vinfast can differentiate its product in an more and more saturated market and whether or not the rising demand for EVs can sustain with the corporate’s formidable plans for growth.
This text was produced and syndicated by Wealth of Geeks.
