EV maker VinFast reports narrowing losses even as sales fall

VinFast Auto Ltd.’s first-quarter loss narrowed while car sales declined as the Vietnamese EV maker sets ambitious goals to be a global brand amid declining worldwide demand for electric vehicles.  

The company reported a net loss of $618.3 million in the first three months of this year, decreasing 12.3% from the fourth quarter, the company said in a filing. Revenue for the period was $302.6 million, down significantly from sales of $436.5 million in the previous quarter but up 269.7% year-on-year.

VinFast, which said it aims to sell its vehicles in as many as 50 global markets by the end of this year, is introducing its brand amid fading interest from consumers for electric vehicles. Tesla Inc. is cutting its workforce by more than 10% while Chinese EV makers are locked in a price war as demand for the vehicles slows.

VinFast delivered 9,689 cars in the first quarter, a 28% drop from the previous three months. It delivered a total of 34,855 vehicles last year. The company reaffirmed its forecast of 100,000 vehicle deliveries in 2024.

Fifty-six percent of VinFast’s first-quarter EV sales were to related parties of the company, the company said. In 2023, VinFast said 72% of its EV sales and 46% of e-scooter deliveries were to related parties, in particular to taxi company GSM Green and Smart Mobility Joint Stock Co., in which Vingroup’s chairman Pham Nhat Vuong holds a 95% stake.

VinFast shipped its first EVs to the US in late 2022. It now has a network of 16 dealers in seven states, the company said. Ten of the dealers will start operations in the second quarter, it said.

“We saw a nice pick up in the US market in the first quarter,” VinFast’s Chairwoman Le Thi Thu Thuy said in an interview. US car sales accounted for more than 10% of total vehicle deliveries in the period, she added. 

VinFast is constructing a $2 billion manufacturing complex in North Carolina and broke ground at its electric vehicle manufacturing site in India’s Tamil Nadu in February while planning a factory in Indonesia.

VinFast, in an earlier filing, said it still plans to complete principal construction of the North Carolina manufacturing complex by the end of 2025, with finalization of production processes completed shortly after that. –BLOOMBERG