Another ? Another new brand of car? In recent years, with the advent of the electric car, a number of more or less consistent and exotic start-ups have flourished in the market, and the end of fuel combustion in 2035 should further stimulate initiatives, since the electric car is much easier to operate. create and assemble than good old gasoline.
In this avalanche of new applicants, eager to get a piece of the car market pie, the new guy, at least the latest one, is called Winfast, and he has a Vietnamese passport. Except that the country doesn’t have the slightest trace of an automobile tradition, that its 110 million people travel mostly by scooters, and that individual car ownership is still in its infancy. So ? Let’s move on to something else, shall we? Do we tell ourselves that the newcomer has no chance in Europe and the USA, the strongholds of the car, where he intends to carve out a glorious place for himself? Not so easy.
Vinfast is owned by Vingroup, the first and very powerful private company in the country that operates in real estate, education, telephony, education, medicine, hospitality and so on. With an annual turnover of $14 billion, 70,000 employees and a $39 billion valuation on the Asian stock exchanges, the company carefully prepared for the arrival by car. And to find out, we went to the very heart of the conglomerate reactor. Destination Hai Phong, in northern Vietnam, where the VF8, VF9 and future VF7 are being built and will land here.
It was there, on hundreds of hectares, that a giant plant with an investment of $3.5 billion emerged in 2018. This makes it possible to produce 250,000 vehicles per year, and the rate can increase to 950,000 models per year. But because Vinfast wants to control its entire production chain, it has added a battery gigafactory where small, genuine Samsung cells are assembled.
First association with BMW
But you don’t improvise like a car manufacturer. Also, to find out, Vinfast has joined forces with BMW for a win-win deal. In Vietnam, imported cars are taxed at a rate of 200%. So to get around these gigantic extra costs, the German commissioned a local brand to create and rebrand his X5 and its 5 Series, renamed Vinfast President and Vinfast Lux respectively. Thus, for four years, the Vietnamese studied and integrated the quality of German production before terminating, this August, the contract that bound them to the Munich firm. Now Vinfast stands on its own feet and they have scales.
For this, it is good to have one factory, and even better, three, especially for international development. In addition, the Vietnamese manufacturer has decided to invest $2 billion in the United States in a second production plant under construction. In three years it should employ 7,000 people. And then Europe? This has not been forgotten and a third plant is due to open in Germany with investments similar to those made in the US.
This brings the addition to 7.5 billion. But it doesn’t stop there, because when you love, you don’t count. So, to distribute their cars, Vinfast doesn’t want to surround itself with independent dealers. His garages and workshops are located in all countries where he is present, he intends to be the owner. In France, 8 are already under construction or about to open, while a Vietnamese company wants to open 20 and 50 across Europe. At stake: the recruitment of 700 employees. In parallel with these directly owned stores, the new brand intends to carry out online sales, with the commercial policy being activated on two fronts: virtual and real, Tesla-style.
But how do you reset all those VF7, VF8 and VF9 that will be splashing? It’s simple: it’s enough, again, to look from the side of Tesla, who was doing quite well. That’s how in Vietnam the new brand has already financed and installed its own fast charging stations, there are now 40,000 of them. Is that not much? For reference: there are 65,000 people in France.
We ride at Vinfast, go to school at Vinschool and shop at Vinmall
But Vinfast does not intend to install its own terminals in Europe, or rather it is a partnership agreement with existing infrastructures like Ionity, but the deal has not yet been concluded. Similarly, the new manufacturer is not going to, and for good reason, allow its customers on the old continent to benefit from its Withanmian ecosystem.
As we said, Vingroup is a huge conglomerate. Thus, with a university, 7 hospitals and many schools, as well as real estate programs, he allows his clients to access packages. By purchasing a Vinhome villa, they receive discounts on their Vinfast car, on Vinschool fees at Vinuniversity for their children. And when it’s vacation time, they can stay at the giant Vinpearl resorts, always at a discount.
Obviously, Europeans and Americans will not benefit from the Vingroup galaxy by purchasing the VF8, which should be available to us in a few months. At least for now. Because landing Vinfast cars is not a Trojan horse on the way to the international market? The first step before the arrival of other activities of the group. The management claims that it is focused on the automotive industry and not on other industries. That is.
However, if successful, overseas product diversification is tempting for such an ambitious group. But it is still necessary that this success be at a rendezvous. Tesla, America’s great model Vinfast, got its start in 2008 when he launched his roadster and had to wait over ten years to make money. Is Vinfast’s backbone strong enough to hold on and invest for this long? Answer in 2032 to see if VF7s, 8s and 9s and their descendants abound on our streets this year.