(car revving)
- 2022 has already been a banger of an automotive year.
And with a summer that will include the new Z,
Ford Lightning, and a manual Supra,
consumers and Wall Street alike are riding high
on a wave of exciting new cars.
But if you're a fan of EVs,
or even just live in the great state of North Carolina,
there's another reason to be pumped.
With construction set to begin
on a massive stateside manufacturing plant
and an upcoming IPO, Vietnam based car company, VinFast,
is poised to make an impact on the automotive market.
How much of an impact do you ask?
Well, not entirely sure.
Which is why today, we're gonna take a deep dive
into this intriguing import.
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- Since production began in 2017,
VinFast has grown at an impressive rate, to say the least.
Initially operating out
of a former GM assembly plant in Illinois,
then constructing an additional
state-of-the-art facility in Hai Phong,
the white hot manufacturer makes scooters,
motorcycles, and of course cars.
A major reason for their rapid rise
is the fact that VinFast
belongs to the conglomerate, Vin Group,
which is Vietnam's largest privately held business
owned by billionaire Pham Nhat Vuong,
also known as The Chairman.
The Chairman, I like that.
Now right off the bat,
I gotta say that VinFast's manufacturing
is staggeringly efficient.
They developed their first three car models
in just 21 months with a claimed
90% automated production
with the ability to crank out 250,000 cars
and 500,000 e-scooters per year.
Last year, VinFast reported a domestic gain of 54%,
and had the highest selling vehicle in Vietnam
with their VinFast Fadil hatchback.
Along with the company's rapid financial success,
their patience has also been commendable
as they've waited to get a solid footing
in their own home country before going abroad.
Well, the wait is finally over.
VinFast is throwing their hat
into the European and North American markets this very year.
Additionally, they've announced plans
for our North Carolina plant.
They're also gearing out for US stock market listing.
Let's make some money, baby.
To give you an idea of VinFast's vision of the future,
I'll quote from their top brass.
Their global CEO has stated that
"We aspire to be one of the leading
electric vehicle manufacturers in the world,
while inspiring our customers to be boundless together
and join hands in the electric vehicle revolution,
creating a sustainable future for all."
Nice.
Emmanuel Bret, VinFast deputy CEO
of global sales and marketing,
has recently echoed the same ambitious statements.
"There's no secret it's a total commitment
to change the world.
Changing the world.
Wow, dor a company that's been around
for less than five years,
I gotta admire that bullish confidence.
While their current bread and butter in Vietnam
is a combination of electric, hybrid,
and gas powered sedans and crossovers,
VinFast says they'll stop making vehicles
with combustion engines by the end of 2022
to focus solely on EVs.
In fact, they've recruited senior executives
from Tesla, BMW, Porsche, Toyota, and Nissan
to help with their international EV launch.
With a wise focus on the most profitable
Western auto sectors of SUVs and crossovers,
VinFast gave us a glimpse of their soon to be available
in America models at the LA Auto Show last fall.
The VF8 and the VF9.
Look, they had different names back then
but that doesn't really matter now, does it?
The VF8 is a midsize electric crossover
that is expected to hit the streets this summer.
Expected to compete with models
like the Hyundai Ioniq5 Nissan Ariya, and Volkswagen ID.4,
the VF8 starts at 41 grand
and delivers a range of roughly 290 miles.
Not too bad.
About the same size as the Ford Edge,
the VF8 has a smooth EV specific grill,
and LED accent lighting across the front fascia.
The interior is minimal but stylish
with a 15 inch center touch screen,
and push button shifters nestled in the center console.
VinFast says that the VF8
will produce 402 horsepower
and 472 foot pounds of torque,
and then it can do zero to 60 between five and six seconds.
Not super fast for an EV, but not shabby for a crossover.
The VF9 is a larger three row SUV
that starts at $56,000.
It has a 270ish mile battery range
and can allegedly push zero to 60 in 6.3 seconds.
VF9 is expected to compete
with other five passenger electric crossovers
like the Tesla model X, the Mustang Mach E,
and future electric SUVs like the Rivian R1S.
Although it sounds like with the speed
that this one can do, it's more of like a budget option.
All the luxury SUV EVs out there,
they like doing really fast stuff
just for the heck of it.
Just so you say you can.
This is looking to be more like a,
hey, this is 50 something thousand dollars
and you get a three row electric EV.
That's a pretty good price.
Both models are styled
by Italian design house, Pininfarina,
and include innovative technology like a virtual assistant
which leverages artificial intelligence,
big data, and machine learning.
I don't really know what that means either,
but it sounds cool in the brochure.
I'll also mention that VinFast
unveiled the VF7 crossover
and the smaller VF5 and VF6
at the 2022 Consumer Electronic show in Vegas in January.
But ironically, these models aren't planned
to be available in the US.
You know what? Makes sense.
Start small.
VinFast claims that their car
will come with a 10 year warranty,
and there's also a lifetime warranty for the battery.
Let's talk about that battery.
One interesting, and I'll say
potentially very confusing element
of VinFast EV's sales approach at least for now,
is that the automaker owns the onboard battery.
This means that they lease it to the customer
for a monthly fee.
But if there are any issues,
VinFast will fix or replace it at no charge.
In the US, customers will choose
between two different battery subscriptions.
The flexible plan is $35 a month for the VF8
and $44 for the VF9.
It gives customers 310 monthly miles of range,
but they'll get charged
for every mile they drive beyond that.
The second option, the fixed package,
offers unlimited mileage but at triple the monthly cost.
So why is the company taking
this batteries not included angle?
It's actually pretty clever.
Batteries are famously the most expensive part of the EV,
and by leasing out the battery VinFast is hoping
the all in cost for the car will be lower
than including it in the price.
They also want buyers to feel more secure
about the longevity of the new battery technology.
Buyers aren't gonna worry about replacement costs
if they won't be the ones paying to replace it.
But unfortunately, there's one very big setback
for penny pinchers hoping to save all the money they can
with this battery lease arrangement.
And that is, it's kind of confusing.
Real quick guys, if you like this video so far,
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You can have unlimited miles in your VF8
for a flat fee of 110 bucks.
That's easy.
However, if you wanna spend less,
you really gotta keep an eye on your odometer.
With the flexible plan, you can pay a base rate
of $35 for 310 miles.
But for every mile after that, you pay 11 cents.
I drive about 800 miles a month,
which with this plan would cost me about 89 bucks a month
to lease the battery.
Then you gotta tack on the actual cost of charging,
which granted, are far lower than gasoline prices.
And I know I said this was confusing,
but now that I say it out loud
it's really not that confusing.
I think I'm just scared of math.
A far less exciting battery related element to consider
is that the VinFast charging network
could start out a little wonky.
They did just announce a partnership
with rapidly growing Electrify America,
but they're a company who've been routinely knocked
for inconsistent service.
I wonder if that has anything to do
with the fact that Electrify America is just a fancy name
for Volkswagen's government mandated punishment
for the diesel gate scandal.
With a potential valuation of $2 billion,
VinFast's IPO would be the biggest ever
by a Vietnamese company.
And if it all works out, they would also be
one of the few Vietnamese companies to list in the US.
That's pretty exciting.
What's more, the 2,000 acre VinFast factory
in Chatham County, North Carolina
will begin the first $2 billion phase of construction
sometime this year.
Starting in 2024, the plant will have
an estimated annual capacity of 150,000 vehicles per year,
while continuing to expand
with the help of a $4 billion total facility investment.
This will be North Carolina's first car manufacturing plant,
and it is the largest economic development announcement
in the tar heel state's history.
VinFast's project is estimated to bring 7,500 new jobs,
and grow the state's economy by at least 70 billion
over the next 30 years if it all pans out.
Very good for the state.
At the announcement in Raleigh in March,
North Carolina Governor Roy Cooper said,
"VinFast's transformative project
will bring many good jobs to our state,
along with a healthier environment
as more electric vehicles take to the road
to help us reduce greenhouse gas emissions."
Our great state's roads should be even more beautiful
now that all those squatted trucks are also illegal.
He didn't say that last part.
I made that up.
The Carolina plant will make the VF8 and VF9,
batteries, as well as electric buses.
But until it's actually rolling, models will be exported
from the VinFast assembly plant in Hai Phong.
By the end of December, 2021,
VinFast began delivering its first EVs
to customers in Vietnam.
The first time EVs have ever been sold in the country.
Meanwhile, executives have said they received
some 65,000 global reservations since January,
and aim to sell upwards of a million EVs
within five to six years.
That's a big goal.
I hope they pull it off.
This is gonna be a super interesting story to follow
simply because of VinFast's origins.
I mean, how many companies from outside Japan, Korea, Europe
and America are selling cars in the US?
Exactly.
I'm still a bit skeptical that a somewhat unproven automaker
can pull it off, but I might be totally wrong.
The global EV market is projected to reach
$803 billion over the next five years,
which represents an exciting opportunity for VinFast,
not to mention other upstart EV companies
to capture a decent market share.
And with the likes of Kia and Hyundai
moving up market towards the premium and luxury segments,
there might be a place
for a smaller manufacturer to step in.
I kinda like their interesting approach to battery leasing,
which might also appeal to nervous EV buyers
who heard $10,000 horror stories
about Tesla or Toyota battery replacements.
It's me, I've heard those stories.
They've also got the chairman's money,
and maybe even a little of yours
if you choose to invest when they go public.
They plan to sell direct in 30 stores across California,
and their US headquarters are right here in LA.
So VinFast, maybe scoot one of those cars our way
for a little test drive.
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(upbeat rock music)
- Thank you very much for watching, Wheelhouse.
What do you think?
Does VinFast have a realistic shot
of making a dent in the US market?
Are you pumped to get behind the wheel
of one of these things?
How much would you pay to lease a battery?
I wanna know.
Let me know down in the comments
Follow Donut on all social media @donut media.
Follow me @nolanjsykes.
Be kind. See you next time.