VinFast founder has no plans to inject more money into EV maker

Billionaire Pham Nhat Vuong has no plans to personally invest any more money in VinFast, the company's CEO said, even as the Vietnamese electric vehicle maker falls behind on factory construction plans in the U.S. and cuts staff.

Vuong, whose net worth is around $4.1 billion, is the chairman of Vingroup, a conglomerate whose operations include real estate, leisure parks and a university.

VinFast was founded by Vuong in 2017, and as of September, the EV maker's owners and lenders had invested about $7.5 billion to fund operating expenses and capital expenditures.

"Currently, Mr. Vuong has no plans" to personally invest further in VinFast, CEO Le Thi Thu Thuy said in response to questions from Bloomberg News.

VinFast lost $1.3 billion in 2021 and close to $1.5 billion in the nine months through Sept. 30, according to a filing with the U.S. Securities and Exchange Commission ahead of VinFast's planned initial public offering. The December filing also said the company expects to continue to incur operating and net losses in the near term.

In the filing, VinFast said Vingroup had issued support letters to the effect that "Vingroup has the ability and will continue to provide financial support sufficient to meet our needs for continued operation." The document also said that VinFast will "require significant additional capital," expected to come via debt and equity financing and related-party financing.

VinFast was to begin construction of its planned North Carolina plant in the U.S. in September, Thuy said on the sidelines of the Qatar Economic Forum in June last year. The factory even won praise from US President Joe Biden, who in March tweeted that it was the "latest example of my economic strategy at work."
 

Thuy said this week that the factory has "basically completed the site clearance" and VinFast is "finalizing the permits so construction can commence." She added VinFast is still on track to start trial production at the North Carolina facility by 2024.

The longer the construction is delayed, the longer it will take for VinFast to start making EVs locally in North America and have its vehicles eligible for the Biden administration's $7,500-a-car clean energy subsidy.

Until then, VinFast plans to make EVs at its factory in Haiphong in Vietnam's north and ship them to the U.S.. But already those deliveries have been set back from an expected timeline of late 2022 to the second half of this month.

Thuy said the delivery delay was because VinFast was waiting for certification from the U.S. Environmental Protection Agency on the increase of its model VF8's driving range, which is now 207 miles (333 km). "While waiting for the EPA's certification, VinFast has continued to update the software to improve the user experiences," she said.

VinFast cut about 80 jobs in North America, including its U.S. chief financial officer, people familiar with the matter said earlier this month. The departure of Rodney Haynes, finance chief of VinFast US, "does not affect Vinfast's operations in the U.S. or globally," the company said.

In November, VinFast said it had been forced to delay the European launch of the VF 8 and VF 9 electric SUVs to early 2023 from the second half of 2022 because of the global shortage of semiconductors.

The EV startup has said it aims to make 1.1 million vehicles annually by 2026. In the three months through Dec. 31, VinFast delivered more than 4,900 EVs, Thuy said. That gives a current annual run rate of less than 20,000 units a year.

"In the short term, we cannot reveal specific numbers, but VinFast has delivered thousands of EVs and has nearly 70,000 reservations to be produced and delivered to customers as soon as possible," Thuy said. "In addition, we have also accepted deposits for VF5 and will soon open reservations for VF6 and VF7 globally with the expected delivery date starting from the end of 2023."