Background VinFast
Always have a plan B
VinFast also works with solid state battery specialists at ProLogium
© press-inform – the press office
The Vietnamese car manufacturer VinFast is pursuing ambitious goals: the first electric cars from the automotive no-man’s-land are expected to be on European and American roads by the end of the year. The Vietnamese do not want to rely on others.
August of this year represents a turning point for the Vietnamese car manufacturer VinFast. Because that is when the last model with a combustion engine will roll off the assembly line in the factory near the city of Hai Phong. Then it’s “all in” with the electric motor. First with the crossover brothers and sisters from the D-Segment VF 8 and the 5.12 meter long E-Segment SUV VF 9, both of which are on a mixed platform. In other words, they are designed for both an electric drive and a conventional combustion engine. This product strategy makes sense when you take a closer look at the Asian manufacturer’s plans.
It provides for the delivery of the Vietnamese brothers VF 8 and VF 9 to begin in some European countries, the USA and Canada at the end of 2022. “Everyone knows the Americans’ preference for SUVs,” says Le Thi Thu Thuy, explaining the procedure. It shouldn’t stay that way. VinFast is investing two billion dollars and building a factory in the US state of North Carolina, where 150,000 cars are expected to roll off the assembly line by July 2025. The best wishes of the Americans accompany the market entry of the Asian car manufacturer. President Joe Biden expressly welcomes VinFast. After all, around 7,000 jobs are to be created with the production facility. “Our efforts to build a clean energy economy are driving companies to increase manufacturing in America, build supply chains here and ultimately reduce costs,” said the US President.
This optimism is reflected in the goals of the Asians. A good year later, the US-Vietnamese duo is said to be producing 500,000 models and by the end of 2026 around 950,000 units a year are expected to roll off the assembly line. In order to be able to cope with this number, should a VinFast factory also be built from scratch in Europe? Where? Is still completely open. Even if Le Thi Thu Thuy has already looked at five possible locations in Germany and two in France. There are enough potential candidates, including the Ford plant in Saarlouis and the Opel factory in Eisenach. “We have a long, very detailed list of requirements. That these points are fulfilled is more important than the place where the plant is located. We never rely on one option, but always have a plan B ready and, if necessary, a plan C or D,” explains Madame Thuy, as she is reverently called by her employees. The Asians are working with German Trade and Invest (GTAI) to find the right place. A connection that dates back to the times of former CEO Michael Lohscheller.
The VinFast expansion strategy follows this pattern in every aspect. Because the Vietnamese are not putting everything on the North American map, but are preparing to enter the market in Germany, France and the Netherlands at the same time. Initially, 50 bases are planned, 25 of them in Germany alone. Starting with branches in Frankfurt, Berlin, Cologne, Oberhausen and Hamburg. Countries like Norway are absent from this list. The logic of the Asians is quite understandable. Other brands such as Tesla or VW are already further ahead in the e-conquest of the Scandinavian country and it would not be advisable to face this tough competition now. But that doesn’t mean that Scandinavia, England or Italy remain a blank spot on the VinFast map. On the contrary. They are part of the second wave. Orders are already possible. By the end of May, around 73,000 customers worldwide had reserved a Vietnamese Stromer.
Reads just as great on paper as it sounds out of the mouth of the bright VinFast boss. The only question is which cars the Europeans and Americans should buy. The next platform will be purely electric. As before, the Vietnamese are hiring several partners, probably including Magna, Bosch and ZF. “We keep the reins of action in our hands,” clarifies Le Thi Thu Thuy. The VF 7 will be based on this technology as early as next year and will be launched in the USA alongside the current models. The E-segment SUV VF 9 will alternatively be available with two battery sizes of 95 or 123 kilowatt hours. The entire model range VF 5, VF 6, VF 7, VF 8 and VF 9 will be available relatively quickly, including right-hand drive versions of the VF6 and VF7. Small, affordable cars like the VF5 will not initially make the leap to the United States. An electric sports car is also not planned, instead VinFast is already working on a dynamic sedan. The Vietnamese also want to convince the Europeans with electric scooters. As far as the charging stations are concerned, the Vietnamese are already negotiating with partners.
The supply chain for the batteries is already in place. In addition to the two locations in Vietnam, North Carolina will also have a giga factory. While the US versions are equipped with Samsung SDI cells, those in Vietnam can also come from CATL. In order to be prepared for the future in the form of solid cell batteries, VinFast works together with the solid battery specialists from ProLogium. The question is how these ambitious plans are to be financed. Although the fortune of VinGroup founder Phạm Nhật Vượng is estimated at 7.5 to 9.5 billion, the resources are not inexhaustible. Since VinFast was founded in 2017, the umbrella company VinGroup has already invested 6.6 billion US dollars in the car manufacturer. In order for the ambitious goals to be achieved, fresh money must be generated. This can be done with investors on the one hand and with an IPO on the other. The Asians don’t want to rush into anything with this “IPO” (“Initial Public Offering”). “We’re just waiting for the right moment,” says Le Thi Thu Thuy, and there’s little doubt that she means exactly that.