San Francisco Frontiers - VinFast boss insists share volatility 'normal'

Shares in the communist state's first homegrown car manufacturer have veered wildly since it listed on the Nasdaq in August, peaking above $82 before lurching back down, closing on Thursday at $12.56.

At one point VinFast's valuation was greater than auto behemoths Ford and General Motors, but some commentators have warned it is overvalued, pointing to slow sales and poor reviews of its VF8 model in the United States.

But CEO Le Thi Thu Thuy insisted the volatility was to be expected.

"It's normal for the share price to be very volatile at the beginning of the listing, especially with such a very small free float," she told AFP in an interview at the company's offices in Hanoi.

Only around one percent of VinFast shares are listed for trading, with 99 percent held by Pham Nhat Vuong, the owner of parent group Vingroup and Vietnam's richest man.

Despite posting a loss of $2 billion in 2022 and over $1 billion in the first half of 2023, VinFast has embarked on a major push to become a global player in the lucrative but crowded EV market.

"In the next year or so, we are targeting that so the loss is becoming less and less," Thuy said.

The company, which launched in 2017, aims to compete with giants like Elon Musk's Tesla, and has begun work on a factory in the US state of North Carolina.

"I think the past has been more challenging than the path forward," Thuy said.

"The task is daunting in front of us, but I think we have achieved a lot we've done a lot in the last six years. We are ready for the path ahead."

VinFast's Nasdaq listing came just weeks before US President Joe Biden visited Hanoi on a trip to boost trade ties, particuarly in high-tech manufacturing, as Washington seeks to reduce its reliance on China for key components and resources.

Thuy was part of a roundtable of CEOs that held talks with Biden as well as a host of executives from US tech firms including Google and Boeing.

- Tesla tussle -

The pivot to the United States is a bold move by chairman Vuong, who started out selling dried noodles in the former Soviet Union before amassing his $5 billion fortune in a range of sectors including real estate, tourism and education.

VinFast opened six showrooms in California in July, including a flagship store in upmarket Santa Monica as it seeks to compete in a US market dominated by Tesla.

It also has outlets in France, Germany and the Netherlands and has announced plans to expand from 2024 into markets in Asia -- including India and Indonesia -- and the Middle East.

Thuy, a former Lehman Brothers executive who studied in Japan, said the company needed to keep investing to build its reputation internationally.

"Right now if you look at VinFast, you kind of look at it as like two different companies -- VinFast in Vietnam, which is somewhat established," she said.

"And then outside of Vietnam is a different VinFast that needs to build a brand and needs to prove itself."

According to VinFast figures, around 17,000 orders for two models -- the VF8 and the VF9 -- have been placed by customers worldwide, including around 10,000 in the United States.

But as of last month only 350 cars -- all of them VF8s -- were currently on the road.

U.Lee--SFF