Shares of VinFast Auto Ltd., the Vietnamese electric vehicle (EV) start-up, made a strong debut on the US stock exchange one week ago. On 22nd August, at the time of writing, the stock is up by more than ~100%, with its market cap soaring past $70 billion as investors continue to build long positions in the stock. New IPO Stock VinFast has recently released an update and it appears that investors are quite optimistic about that update.
New IPO Stock VinFast announced that VF 9 has certificated EPA range of 330 miles for Eco trim and 291 miles for Plus trim if fully charged. These certified ranges surpass the company’s initial estimates, affirming the company’s efforts to improve product quality and offer best experience to customers. The VF 9 is full-size, 7-passenger, all-electric SUV, having MSRP of $83,000 and $91,000 for Eco and Plus models, respectively. VF’9’s 330-mile battery range has been categorised as best in the market, confirming the company’s efforts and dedication to make competitive vehicles. VinFast anticipates to export this model to North American market later in the year, joining VF 8 model.
The VF 9 also has a competitive warranty of 10 years/125,000 miles for the vehicle and 10 years unlimited mileage for the battery, with mobile repair and rescue services during the warranty period.
On 15th August, New IPO Stock VinFast celebrated its listing and start of trading of its shares on the Nasdaq Global Select Market under the symbol “VFS.” The company was listed at an equity value of more than US$23 billion. Public listing of the company comes after completion of the business combination with Black Spade Acquisition Co on August 14, 2023. At the time of listing, it became the leading Vietnamese company listed on the U.S. stock market in terms of market cap. The combined company will carry out operations as VinFast Auto Ltd. and it will be led by Global CEO Le Thi Thu Thuy, or Madame Thuy Le. He will be supported by experienced, diverse, and entrepreneurial senior management team. Black Spade should provide business advisory input for brand’s growth and help the company with direct investor engagement.
New IPO Stock VinFast delivered ~19,000 EVs consisting of VF e34, VF 5, VF 8, and VF 9 models, as of June 30, 2023. It continues to look forward to build upon rapid expansion as it launches next-gen EVs and solutions, and executes its strategy of expanding its footprint globally. It has able to establish strong foothold in Vietnamese home market as it rolled out its own charging network spanning throughout 63 cities and provinces. Plans are there to expand it further in upcoming years. New IPO Stock VinFast has established company-owned retail and service network consisting more than 122 VinFast stores worldwide.
Focus of the company is on strengthening its position in global EV market. This will be done by leveraging new partnerships with distributors and dealers in certain selected markets, such as North America, Europe, Vietnam, and Southeast Asia. Target markets of the company should offer an expected total addressable market (TAM) of ~$1.3 trillion by 2027, exhibiting an annual shipment of ~35 million vehicles, as per Frost & Sullivan. The company’s targeted geographies are vital to its strategy, with strong momentum and favourable forces supporting the switch to EVs throughout vehicle segments. The company expects that A- through E- electric SUV segments should lead EV revolution and stem profitable growth in near and long term throughout automotive market.
Experts believe that share of global EVs as percentage of total passenger vehicles has tripled from 2.1% in 2019 to 6.7% in 2021. This should touch 28.6% in 2027. Shipment of EVs in North America, Europe and Vietnam touched the mark of 1.5 million in 2021, exhibiting a share of 5.3%, and this should touch 9.5 million shipments in 2027, with share of 27.2%. By the year 2027, annual shipment of EV in the U.S. and Europe should account for more than 40% of the global EV market.
All the EV segments should grow at high double-digits in the company’s focus markets. This trend is expected to be stronger for C, D and E segments as they have longer driving range, larger passenger space, and better interior design.
Consumers are more willing to buy EVs having higher quality and performance and more intelligent functions, including features like longer lasting battery, longer driving range, larger passenger space, and 4G/5G connectivity. In comparison to other vehicle types, electric-SUVs having higher performance capabilities should better support various usage scenarios of the customers such as family transportation, off-road driving and long road trips. In the company’s focus markets, market share of electric-SUV’s relating to the overall EV shipment should increase from 48.0% in 2021 to 64.9% in 2027.
Favorable policies in the company’s key markets should act as a major tailwind. In the United States, several policies were issued and these are favorable for EV. Such policies include raising emission standards, offering government subsidies and increasing incentives for adoption of EVs. For instance, IRA is a major legislation targeting to accelerate mobility electrification in the United States.
In Europe, several countries executed the policies including Auto Industry Rescue Plan and UK Vehicle Scrappage Scheme to offer subsidies for purchasing EVs in UK. German Government released recovery and resilience plan focused on subsidizing purchase of over 560,000 decarbonized vehicles and promote development of charging infrastructure through funding installation of 50,000 publicly accessible charging points and 400,000 charging points in residential buildings.
Vietnamese government has proposed policies which are focused on reducing the usage of motorcycles, to control the pollution issues and decrease traffic congestion. Reduction in the usage of motorcycles results in developing opportunities for alternative transportation modes including EVs. For example, Vietnamese government called for restrictions or suspension of motorcycles in major downtown areas which are located in 5 major cities after 2030 and compulsory ban on any motorcycles failing to meet emission standards from gaining access to some specified areas of Hanoi.