VinFast targets sales of 100,000 EVs in 2024, looks to build scale in Asian markets

Vietnamese EV maker, which has entered the US market, looks to strengthen its ability to compete effectively in other markets to build scale, especially untapped, volume-driven markets like Indonesia and India.

Autocar Pro News Desk By Autocar Pro News Desk calendar 23 Feb 2024 Views icon4155 Views Share - Share to Facebook Share to Twitter Share to LinkedIn Share to Whatsapp
VinFast targets sales of 100,000 EVs in 2024, looks to build scale in Asian markets

Vietnamese electric vehicle manufacturer announced its fourth-quarter and full calendar-year 2023 results yesterday. The EV OEM sold a total of 34,855 electric vehicles (cars and e-bus) in 2023, marking a 374% increase compared to the previous year. This included 13,513 electric vehicles in the fourth quarter, up 35% from the third quarter of 2023. Despite a slight decrease in the fourth quarter of 2023 compared to the third quarter, e-scooter deliveries also saw significant growth, rising 48% YoY for a total of 72,468 units in 2023.

VinFast's revenues reached $437 million in the fourth quarter of 2023, a 26% increase from the previous quarter and a 133% increase year-over-year. This growth was driven by both higher sales volumes and an improved product mix. Total revenues reached $1,198 million in FY 2023, representing an increase of 91% from 2022. Gross loss was $174.9 million in the fourth quarter of 2023, and was $551.6 million in FY 2023.

VinFast is targeting delivery of 100,000 vehicles in CY2024, leveraging a larger distribution network and supported by resilient and potentially recovering macroeconomic conditions. The company states that “encouraging signs are emerging for VinFast in early 2024, particularly in California, where the company’s direct-to-consumer approach has fuelled a significant order jump in January and February, marking a strong start in the critical U.S. market. After laying a solid foundation in markets such as the US, Canada, and several European countries, VinFast's global expansion strategy for 2024 focuses on penetrating other global markets including markets closer to home like Indonesia and India.”

Madam Thuy Le, Chairwoman of the Board of Directors, VinFast said: "2023 was a whirlwind of firsts for VinFast, culminating in a strong public debut. We launched exciting new products, expanded our distribution network, and solidified our presence in existing markets while opening doors to promising new ones. These moves laid a strong foundation for 2024, a year of global expansion and cost optimization. We're already seeing positive signs in key markets like the U.S. and Indonesia. We're not resting on our laurels. Fueled by this momentum and a recovering consumer sentiment, we're setting an ambitious target of delivering 100,000 vehicles in 2024. This is a testament to our unwavering commitment to building a greener future for all".

Ms Anh Nguyen, Chief Financial Officer, stated: “We saw favourable results in our business operations in the fourth quarter, with strong revenue growth and improved profit margins. We remain focused on enhancing investment performance and strengthening our balance sheet by reducing production and materials costs and strategically optimising our global manufacturing capex. These initiatives will support our expansion efforts into high-growth markets like Indonesia and India and unlock the potential of these regions to drive substantial sales growth.”

Expanding commercial footprint and product portfolio
In 2023, VinFast accelerated its expansion efforts with a multi-pronged strategy to scale its commercial footprint, product offerings and manufacturing capabilities, setting the foundation for growth in 2024 and beyond.

In terms of product launches, VinFast introduced four new SUV models in Vietnam across segments, including the flagship VF 9 model, VF 5, VF 6 and the VF 7. In Q4 2023, it made an important shift  from the capital-heavy, direct-to-consumer distribution model to a capital-light hybrid model with a strong focus on leveraging existing distribution infrastructure by building a dealership network in the U.S. and globally.

VinFast now has 13 stores and service centres in California and 6 new dealers in 5 states – New York, Texas, Kansas, Florida and North Carolina –and has had an additional 75 dealers under application.

The company expects to reach approximately 130 points of sales in North America and 400 globally by the end of 2024.

Focus on cost reduction and tapping Asian markets in 2024
In 2024, VinFast aims to balance revenue growth with cost optimisation through optimised production and materials costs, and investing strategically in promising markets closer to Vietnam. To put more VinFast vehicles on the road, it plans to broaden the distribution channels through leveraging the local network and expertise of third party dealerships and distributors.

Its entry into a high-profile market like the US has strengthened the company’s ability to compete effectively in other markets to build scale, especially the untapped, volume-driven Asia markets.

Earlier this month at the Indonesia International Motor Show (IIMS), VinFast announced its entry into the Indonesian market with the right-hand-drive VF 5, VF e34, VF 6, and VF 7 models. VinFast also signed MoUs with three businesses at IIMS, solidifying its expansion in Indonesia and securing the delivery of a total of 600 electric vehicles.

In India, VinFast aims to seize the growth opportunities and market potential in one of the fastest-growing global economies. Just over a month after the signing of an MoU with the government of Tamil Nadu, India, VinFast has announced the groundbreaking ceremony on February 25 for the Integrated Electric Vehicle Manufacturing Facility in Thoothukudi City. With a vision to become a leading regional electric vehicle manufacturing hub, the plant has a capacity of up to 150,000 electric vehicles per year when it officially goes into operation.

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EV share of auto sales in India grows to over 6% in CY2023

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