It's a bold and risky bet but it sends a clear message to local vehicle manufacturers: the cards for the American electric vehicle market are not yet completely distributed. There are still places to take (and cards yet to fall).
Vietnamese electric vehicle maker VinFast has decided to challenge Tesla (TSLA), Ford (F), GM (GM), Rivian (RIVN) and Lucid Group (LCID) on American soil. VinFast will build a factory in North Carolina this year.
This production site will be located in Chatham County’s Triangle Innovation Point megasite, covering an area of 800-hectares, with 3 main areas: electric cars and buses production and assembly, EV batteries production, and ancillary industries for suppliers, the company said in a press release.
Construction of the site will start after obtaining the necessary permit, says VinFast, which hopes to start producing cars there in July 2024. The initial capacity is expected to be 150,000 vehicles per year.
The group will initially invest $2 billion to sell cars to Americans.
VinFast Will Create Thousands of Jobs
“North Carolina’s strong commitments in building a clean energy economy, fighting climate change, and reducing greenhouse gas emissions in transportation make it an ideal location for VinFast to develop its premium, smart, and environmentally friendly EVs,” said Le Thi Thu Thuy, Vingroup vice-chair and VinFast Global CEO.
“Having a production facility right in the market will help VinFast to proactively manage its supply chain, maintain stablized prices and shorten product supply time, making VinFast’s Evs more accessible to customers, contributing to the realization of local environmental improvement goals.”
However, the manufacturers of electric vehicles that have sought to enter the American market by building factories there in recent years have either failed or given up on a large part of their ambitions.
This is the case of Fisker Automotive (FSR), which had to file for bankruptcy after the collapse of its battery supplier. Faraday Future Intelligent (FFIE), which launched to great fanfare in 2014, is currently mired in investigations into statements made by its executives. The group has still not managed to market a vehicle. Faraday also sold land purchased in Nevada where the automaker planned to build a factory.
Headquartered in Hanoi, Vietnam, VinFast, founded in 2017, said it's a global producer of premium automobiles. North Carolina will be its second plant, the other one is a vehicle production facility in Haiphong, Vietnam, that will have the capacity to produce 950,000 vehicles per year by 2026, according to the company.
VinFast has also established operations in Canada, Germany, France, and the Netherlands. The company currently provides an ecosystem of EV products in its home country of Vietnam, including e-scooters, electric buses, electric cars, charging station systems, and green energy solutions, according to a press release.
U.S. President Joe Biden hailed VinFast's investment on Twitter, saying it would create more than 7,000 jobs.
VinFast Plans U.S. IPO
"Today, VinFast announced it will build an electric vehicle and battery manufacturing facility in North Carolina — $4 billion to create more than 7,000 jobs. It’s the latest example of my economic strategy at work.
Vehicles to be produced at the North Carolina site include the VinFast VF 9, a 7-passenger all-electric Sport Utility Vehicle (SUV) and the VinFast VF 8, a 5-passenger, all-electric mid-size SUV.
The starting price for the VF 8 with a 316.9 miles range is $41,000, while the starting price for the VF 9 (422.5 miles) is $56,000.
"All early reservations can be refunded, gifted or transferred from April 6, 2022," the company said in January.
The group delivered the first produced cars to its Vietnamese customers in December. It aims to sell a total of about 700,000 to 1 million EVs within five to six years, Thuy told Bloomberg. VinFast has received 50,000 orders globally for its VF 8 and VF 9 models.
VinFast is also working with investments banks, including JPMorgan Chase and Deutsche Bank, to prepare for an IPO in the U.S. If the company materializes this last project, it would become one of the first Vietnamese companies to be traded on an American market. The company is interested in a merger with a Special Purpose Acquisition Company (SPAC) for a U.S. listing.
