Vietnamese electric vehicle (EV) manufacturer VinFast has adjusted its business strategy, delaying the launch of its planned $4 billion factory in North Carolina to 2028. The decision comes as the company faces challenges in the global EV market, including economic uncertainties and shifting consumer preferences.
VinFast, founded by Vietnam’s wealthiest individual, Pham Nhat Vuong, in 2017, has pivoted to producing fully electric vehicles since 2022. Despite initially planning to deliver 100,000 vehicles this year, the company has revised its forecast downward to 80,000 units due to ongoing market dynamics.
“While the second-quarter delivery results were encouraging, ongoing economic headwinds and uncertainties in different macro-economies and (the) global EV landscape necessitate a more prudent outlook for the rest of the year,” VinFast stated in a release on Saturday.
In the second quarter, VinFast reported a 24% increase in sales to approximately 12,000 vehicles compared to the previous quarter, with a total of 21,747 units sold in the first half of 2024, marking a 92% year-over-year rise. However, this figure represents only a fraction of the adjusted annual forecast.
The company remains optimistic about the second half of the year, anticipating robust sales growth driven by product diversification and expansion into new markets across Asia and existing territories.
VinFast’s decision to postpone the North Carolina factory launch aligns with its strategy to optimize capital allocation amidst current market conditions.
“This decision will allow the company to optimize its capital allocation and manage its short-term spending more effectively, focusing more resources on supporting near-term growth targets and strengthening existing operations,” VinFast explained.
Despite recording a significant revenue increase in the first quarter, VinFast reported a net loss of $618 million, reflecting the financial pressures facing many EV manufacturers in today’s competitive landscape.
