VinFast, the recently debuted Vietnamese electric-car maker that at one point was worth more than most of the auto industry, is getting even more of a reality check following a collapse in its share price.
The company reported $623 million in net losses for the quarter ended in September, a more than 30% year-on-year increase. That loss came despite an 159% increase in revenue, to $343 million, over the same period.
With just three months left in the year, VinFast isn’t even halfway to its goal of selling 50,000 cars in 2023. The Vietnamese EV maker sold just over 10,000 cars last quarter, taking its total sales for the year thus far to around 21,000. And VinFast’s founder, Pham Nhat Vuong, may be using other parts of his holdings to support the carmaker’s business: Over half of VinFast’s quarterly sales were to Green SM, a Vietnamese taxi-operator that’s also owned by Vuong.
The company sold 28,220 e-scooters last quarter as well, a 177% jump from the previous quarter.
VinFast is part of Vingroup, the conglomerate chaired by Vuong, also Vietnam’s richest man. Vingroup established the carmaker in 2017, which got its start making gas-powered engines. The company pivoted to the EV sector in 2021 with the VF e34, the Southeast Asian country’s first electric car.
Yet VinFast’s ambition to become an EV powerhouse is running into setbacks.
The company delivered its first cars to the U.S. in early March, yet reviewers panned them, citing inconsistent handling and poor performance.
VinFast debuted on the Nasdaq stock exchange through a special purpose acquisition company (SPAC) in August. The company’s shares surged from an opening price of $22 on Aug. 15 to hit a high of $82.35 at the end of August. At one point, the company was worth more thanMercedes-Benz and BMW.
Analysts pointed out that VinFast’s wild swings in price were due to thin trading. Less than 1% of VinFast’s stock is available to investors, with its founder, Vuong, owning the remaining 99%. That means small shifts in volume could trigger large movements in price.
Investors have since soured on the company. VinFast’s shares are now hovering around $8, an over 90% drop from a peak price of $82 at the end of August.
Still, VinFast has bold plans to expand globally. The company said Thursday that it’s pushing ahead with plans to build factories in India and Indonesia. VinFast CFO David Mansfield said the company is on track to meet its ambitious delivery guidance thanks to expected strong domestic demand in the coming quarter.
The company earlier said it hopes to break even by the end of 2024.