VinFast’s Rapid Market Surge: Challenging Giants in the Auto Industry
In a remarkable turn of events, VinFast Auto, a Vietnamese electric vehicle manufacturer, has emerged as an unexpected competitor to established brands like Mercedes and BMW, just ten days after its debut on the Nasdaq through a SPAC merger. According to Fortune, VinFast’s market value has surged ahead of Mercedes and BMW. As of 10:00 ET on Friday, the company’s shares have risen by a staggering 312% in just a week, according to S&P Global Market Intelligence.
Notably, the company’s stock doubled in value earlier this week following news that the range of their electric crossover, the VF 9, certified by the U.S. Environmental Protection Agency (EPA), exceeded the company’s own estimates, reaching 330 miles (531 km). As a result, VinFast Auto’s market capitalization soared to $100 billion during the trading session.
At present, VinFast has overtaken high-income premium brands like Mercedes-Benz and BMW, along with Chinese electric vehicle manufacturer BYD, backed by Warren Buffett, in terms of market value. However, Tesla remains the undisputed leader among automakers with a market value of approximately $740 billion.
VinFast is a subsidiary of Vingroup, Vietnam’s largest conglomerate, owned by billionaire Pham Nhat Vuong. The electric vehicle manufacturer has revealed its plans to enter the U.S. and European markets, aiming to boost its sales. As per BNI Research, VinFast leads the market share for electric passenger vehicles in Vietnam. The company intends to launch its first U.S. factory by 2025, increasing its annual production capacity from 300,000 to 450,000 electric vehicles.
Nonetheless, it’s worth noting that Fortune highlighted VinFast Auto’s swift recognition as a controversial figure in the automotive world. Their VF8 crossover gained notoriety as one of the worst electric vehicles to debut in the U.S. this year, drawing harsh criticisms from automotive experts and leading the company to offer refunds to dissatisfied customers.
The question arises: “How could a relatively young automaker from a country with limited automotive experience achieve the fourth-highest market value in the automotive world?” In an article by Financial Times, published this week, former investment banker Craig Coben explained this phenomenon by a key factor.
The founder of VinFast, Pham Nhat Vuong, owns 99% of the company’s shares. With less than 1% of shares available for investors to purchase, even minor changes in sales volume can trigger significant fluctuations in the stock price.
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- I'm Vasyl Kolomiiets, a seasoned tech journalist regularly contributing to global publications. Having a profound background in information technologies, I seamlessly blended my technical expertise with my passion for writing, venturing into technology journalism. I've covered a wide range of topics including cutting-edge developments and their impacts on society, contributing to leading tech platforms.
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