VinFast is doing much worse than expected. The funds invested in the car manufacturer by Vietnamese billionaire Phạm Nhật Vượng have not borne fruit on the Old Continent, due to the quality of its cars, which needs to be reviewed. Since its official launch in 2022, the brand has never found the success it was looking for, and has even tried to avoid negative criticism from the press by preferring to buy influencer content to gain recognition and appreciation.
Alongside the VF8, VinFast was supposed to rely on a VF6 compact SUV to increase its sales. But none of this is expected to happen in Europe, according to German journalists from Elektroauto News, who say they are relying on internal documents from the manufacturer. VinFast has reportedly decided to close its network and showrooms as of May 9. The problem would not be so much Europe, but the direct sales system, in a context where customs duties and macroeconomic uncertainty do not allow for stability or the setting of objectives.
VinFast's monstrous debt
"In 2025, we will focus on new products and expanding our presence in the Asian market", recently indicated Lan Anh Nguyen, VinFast's CFO, during the presentation of the company's quarterly figures. No more Europe, then, but perhaps no more North America either, where sales have never taken off either. Simultaneously with a turnover of $1.8 billion, VinFast recorded a net loss of approximately $3.18 billion. A new record, given that 2023 was also a loss-making year, the German media outlet pointed out.
To aim high, VinFast decided to go public. To raise maximum capital and gain confidence, the VinGroup subsidiary chose the Nasdaq in New York, the stock exchange for tech companies. In its first hours of trading in August 2023, its share price plummeted, rising 270% and then falling 45%. Nothing very reasonable. Since then, the stock price has stabilized, but at a level nearly 80% lower than when it was listed. Its market capitalization is now only $8 billion.
Even more critical, the car manufacturer VinFast was criticized in December 2024 for the working conditions of its employees. The brand, born from the Vingroup conglomerate, allegedly forced its workers to work overtime, locked them in the factory, and cut their vacation time. This information was provided by a former employee engineer named Hazar Denli and collected in the British newspaper The Times. "There were also many cases where people went to the airport and were told to turn around, not to get on the plane, and to return to the factory. That was the nature and culture of the company," the man explained.
Source: Elektroauto News
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