On July 12, 2021, VinFast officially put its branches in the US, Canada, France, Germany, and the Netherlands into operation, to prepare for the market launch, step by step realizing the goal of making VinFast a global smart electric car company.
The US, Canada, France, the Netherlands, and Germany have been five key markets in VinFast's business expansion plan from the very beginning. To reach these areas, over the past year, VinFast has rushed to perfect its apparatus and establish a business foundation in the host countries.
In terms of personnel, along with a core of Vietnamese senior management team, VinFast has attracted many experienced automotive and business experts from leading automakers such as Tesla, BMW, Porsche, Toyota, and Nissan, etc., to participate in perfecting the system, expand the network of partners, and prepare for market entry.
As planned, VinFast will officially open two smart electric car models for sale globally in March 2022: the VF e35 and VF e36. These are groundbreaking electric SUVs with impressive exterior designs, class-leading amenities, and the highest safety standards of NHTSA and EURO NCAP. In particular, the VF e35 and VF e36 will be integrated with ADAS (autonomous driving assistance) and Smart Service (intelligent infotainment system) features researched and developed by VinFast and its partners.
Along with the market expansion, VinFast also promotes international cooperation to improve product quality and class. The company's strategic partners are currently leading names in the technology and automotive industry, such as Pininfarina, ZF, Durr, Bosch, ABB, Faurecia, Dassault, Google, etc.
VinFast has lowered its target of selling 15,000 electric vehicles next year, down from the previous estimate of 56,000 vehicles.
However, the Vietnamese brand still expects in the next few years to account for 1% of the total market share in the US, equivalent to 160,000 - 180,000 electric cars sold per year.
"There does not appear to be enough distinction in the vehicles, the technologies, or the market offer to make enough difference unless VinFast can substantially undercut the prices of the competitors," said Peter Wells, professor of Business and Sustainability at Cardiff University’s Center for Automotive Industry Research.
This may also be VinFast's strategy, although no information on the price has been disclosed. The problem with lowering prices "is that moving up-market subsequently is very difficult," added Wells.
Bill Russo, head of Shanghai-based consultancy Automobility (China) and a former Chrysler executive, said: "What VinFast shows is the speed to market and it seems to be. company born to go global".
“Will Americans embrace Vietnamese cars? Japanese cars were cheap ‘econoboxes’ in the 1970s and Koreans were that in the 1980s. So, there is Asian precedent that companies can crack the market,” added Russo.
“Europe may be a more difficult challenge in large markets like Germany or France, but they may have opportunities if it forms the right partnerships with downstream services players.”
Difficulties do not mean VinFast will fail. The company has assembled a team of experienced management, many of whom are former executives of General Motors, the American car giant, who are experienced in the market.
Vingroup rose to become the largest private company in Vietnam thanks to its strong investment in real estate in the 2000s. Since then, the group has expanded its operations through subsidiaries, covering all areas of the economy, including Vinbiocare, a recently launched biotech company.
“Mr. Vuong demonstrates a good vision in this new business, but how he realizes that vision is even more important,” said Mr. Le Hong Hiep of the Vietnam Studies Program at the ISEAS-Yusof Ishak Institute.
Equally important in Vingroup's strategy is its expansion plan into the developed economies of the West, which is a symbolic demonstration of Vietnam's growing importance in world politics and commerce.
Mr. Hiep said VinFast's plan to expand into US and European markets "seems to be well received by both the Vietnamese government and the public because Vingroup is now considered one of the ‘national champions’ that can help transform the Vietnamese economy towards greater innovation and efficiency.".
And even if VinFast's plan to go global falls short of expectations, it will certainly put Vietnam's rising "national champions" on the world map.
Source: asiantimes, doanhnhanplus
Compiled by VietnamCredit