As an avid follower of emerging electric vehicle (EV) companies, you’ve probably heard rumblings about VinFast, the ambitious Vietnamese startup aiming to compete with Elon Musk’s EV juggernaut Tesla. Backed by corporate titan Vingroup, VinFast has progressed from conception to mass production in record time. Now, its sights are set on taking a share of the growing global EV market.
In this comprehensive guide, we’ll analyze VinFast’s prospects to help you understand:
- How VinFast accelerated to manufacturing scale so rapidly
- The technology, pricing and performance metrics of its upcoming EV SUV models
- How VinFast’s novel battery leasing model and manufacturing strategy could impact costs
- The scale of investments and expansions powering VinFast’s international push
- Expert assessments on VinFast‘s capacity to rival major EV automakers
Let’s look under the hood to see if this unlikely contender can threaten Tesla’s pole position.
Rocket Fuel: The Vast Resources Powering VinFast’s Rise
Unlike most startups, VinFast didn’t have to slowly build capabilities while hunting for funding. With vast financial firepower from the start, its parent Vingroup invested over $2 billion directly into VinFast’s production complexes, manufacturing equipment and vehicle development.
This enabled VinFast to shortcut many typical startup hurdles. Instead of step-wise technology development, VinFast purchased turnkey vehicle platforms with full design and engineering support from experienced automotive partners like Pininfarina, BMW and Magna Steyr.
| Year | Milestone |
|---|---|
| 2017 | VinFast founded |
| 2018 | $1.5 billion production complex completed |
| 2019 | 30,000 gasoline cars sold in Vietnam |
| 2021 | Shift to 100% electric vehicle focus announced |
In just three years after its 2017 founding, VinFast sold 30,000 gasoline-powered vehicles in its home country of Vietnam. Now with its 2021 strategic pivot to electric vehicles (EVs), even greater growth beckons.
An EV SUV Lineup Tuned for Global Appeal
VinFast shocked the automotive world by unveiling five electric SUV models at January’s 2022 Consumer Electronics Show (CES). Ranging from compact to full-size options, the futuristic but approachable designs target mass-market appeal.
The first VinFast EVs launching in the United States and Europe are the VF 8 mid-size and VF 9 full-size SUVs.
| Model | Max Range | 0-60 mph | Price (with battery) |
|---|---|---|---|
| VF 8 | 292 miles | 5.5 s | $57,000 |
| VF 9 | 367 miles | 6.5 s | $76,000 |
These figures put VinFast models in close competition on paper with Tesla’s hot-selling Model Y SUV. The VF 8’s 292 mile maximum range trails the Model Y Long Range’s 351 mile range, while the VF 9 tops the Model Y Performance’s 303 mile range.
Acceleration for both VinFast models is brisk at 5.5 and 6.5 seconds respectively from 0 to 60 mph, but again loses by a few ticks to the Model Y Performance’s sports car pace.
VinFast’s Wild Card: Battery Leasing to Enable Lower Prices
Here’s where VinFast shows some truly disruptive thinking. The purchase price above includes VinFast’s unique option of adding the EV battery cost to the vehicle price. However, buyers can alternatively subscribe to VinFast’s battery leasing programs starting at just $169 monthly.
By separating battery ownership, VinFast aims to lower barriers to entry. The company handles maintenance, repairs and replacements while retaining eventual ownership of the profitable battery asset. This framework mirrors the ‘batteries-as-a-service’ concept other automakers have discussed.
Early indicators suggest VinFast’s leasing programs do enable lower net purchase costs after subsidies. Whether confused consumers bite on complex battery subscriptions and tradeoffs between affordability and ownership control remains to be seen.
Betting Big on International Production and Retail Presence
Rather than slowly building international presence, VinFast already made bold moves to bring production and its retail experience directly to global EV strongholds.
Construction commenced on VinFast’s $2 billion North Carolina manufacturing plant set to open in 2024. Localized US production will remove import duties, while meeting regulations for federal tax incentives. VinFast ambitiously targets 550,000 EVs produced Yearly in phase one production, scaling up to 750,000 at full capacity.
On the consumer side, VinFast already launched seven California retail showrooms with plans for 30 total US dealerships this year. This bricks and mortar retailer strategy contrasts sharply with the online sales models prevalent among EV disruptors. VinFast aims for 100 total American showrooms in the near term.
This multi-channel presence combining online ordering, retail showcasing, and on-the-ground service centers checks more boxes for car buyers wanting convenient support.
Financial Footing: IPOs, Venture Funding and Profitability
Ramping production and real estate at speed demands deep pockets, but VinFast has many funding mechanisms primed:
- A planned late 2022 US IPO seeks to raise $60 billion valuing VinFast on par with Ford and GM.
- VinFast’s battery production joint venture with Gotion High-Tech raised $200M in initial venture funding last September.
- VinFast claims a 10% profit margin on its first EV models at current battery prices of $155/kWh, leaving headroom as prices fall.
With expansion costs pre-loaded by Vingroup’s investments, these wide revenue channels position VinFast to turn profitable between 2023-2025 by company targets.
Aggressive on all fronts, VinFast has executed key strategies Tesla itself needed years to lock in. Yet VinFast’s compressed timeline leaves little margin for execution errors. Next we’ll review expert analyst predictions on its viability.
Assessing the Odds: Can the Contender Take the Crown?
“VinFast absolutely has a chance if it can match the product quality, technology innovation and brand recognition Tesla brings.” predicts Travis Langdon, Director of Automotive Research at Jato Dynamics.
“Rivian has shown the public is willing to take a chance on new EV brands with exciting sustainable transport options priced competitively. VinFast checks those boxes.”
However, with limited real-world testing, Langdon and other analysts remain cautiously optimistic until quality control and service capabilities prove out. Once North Carolina factory production launches, VinFast escapes its biggest question mark around scale feasibility.
On service, VinFast notches high points for its streamlined buying process, consumer perks like free Apple Carplay upgrades, and novelties like integrated e-commerce. Reviews of early gasoline models praise reliability, suggesting dependability standards carry over from European engineering roots.
So the dark horse contender enters the track with speed and stamina – though still requiring time to gauge full resilience. Racing neck-and-neck over the long run demands masterful execution.
Gearing Up for the EV Long Game
Early electric vehicles made drivers feel like guinea pigs sacrificing practicality to go green. But the tables have now turned with EVs matching or exceeding combustion-powered cars on range, tech and performance at equal price points.
VinFast aims to leverage this tipping point by delivering competitive, confidence-inspiring EVs wrapped in a customer experience exceeding expectations.
While Tesla maintains a multi-year lead in technology innovation and brand prestige, cracks exist in its armor. Quality control issues, delivery delays and polarizing leadership open the door for fresh challengers.
VinFast revs onto the scene fueled by Vietnamese determination and European ingenuity. Its financial backbone and manufacturing strategy follow Musk’s own visionary playbook. While risks accompany its compressed timeline, VinFast clearly signals more thrills ahead in the great EV race.
I’ll be tracking VinFast’s progress closely – register to get my analysis as the green flag drops on VinFast EV deliveries this year. This unlikely contender’s opening laps set the stage for an exciting showdown.
