Vietnam’s VinFast Pledges to Ditch Gas-Powered Cars in a Year

(Bloomberg) -- VinFast will stop making gas-powered autos by the end of 2022 -- just two-and-a-half years after the first ones rolled off the company's northern Vietnam assembly lines -- as it ramps up global sales of electric SUVs with plans for EV factories in the U.S. and Germany.

The company will focus exclusively on electric vehicles because it presents VinFast a big opportunity in a nascent market, said Le Thi Thu Thuy, vice chairwoman of Vingroup JSC, the parent company of VinFast. 

“The field of electric cars is still in the early stages of development, the level of competition is not too fierce and there is still room for breakthroughs for new brands,” she said. “VinFast is facing an international market with the potential of more than one billion gas-powered cars that will be replaced by electric cars in the near future.” 

VinFast will introduce five electric SUV models at the annual CES technology conference in Las Vegas this week ahead of its planned U.S. initial public offering in the second half of the year, said Thuy, newly-appointed chief executive officer of VinFast. It plans deliveries of EVs in California, Canada, France, Germany and the Netherlands at the end of 2022. 

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VinFast, whose U.S. headquarters is in Los Angeles, has narrowed the location for its planned U.S. factory to three locations, she said. Its first phase is expected to be completed by the end of 2024, Thuy said. 

The factory complex, which will have a capacity to produce 250,000 vehicles a year, will also include battery and electric bus plants, she said. The first phase will have an investment of $1 billion to $1.5 billion, Thuy added. 

The company is looking at five sites in Germany for an EV factory that would open after the U.S. complex is operational, she said. 

VinFast unveiled two electric SUVs -- the VF e35 and VF e36 -- at the Los Angeles Auto Show in November. It will begin accepting global preorders for these two models at CES Jan. 6. Prices for VF e35 and VF e36 -- which will be renamed VF8 and VF9 -- range from $41,000 to $61,000. 

VinFast began delivering its first EVs to Vietnamese consumers on Christmas Day. The company expects to deliver 2,000 electric vehicles in Vietnam by the end of January and has a backlog of 25,000 orders in the Southeast Asian country it expects to fulfill by the end of the year, Thuy said in a Bloomberg TV interview. 

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Thuy was appointed VinFast chief executive in late December, replacing Michael Lohscheller, a former CEO of Opel. VinFast has a deep bench of seasoned automobile executives, she said. 

VinFast sold 32,676 gasoline automobiles in Vietnam last year through November, according to the company. It sold about 30,000 gas vehicles in 2020.

©2022 Bloomberg L.P.