Vingroup lost USD1 billion last year in manufacturing due to poor sales of VinFast vehicles, EV investments

Vingroup lost USD1 billion last year in manufacturing due to poor sales of VinFast vehicles, EV investments

Vingroup, the parent company of VinFast, posted a pre-tax loss of around 23.9 trillion Vietnamese dong (around USD1 billion or RM4.4 billion) at its manufacturing segment last year, according to a report by Nikkei.

The loss was attributed to poor sales of internal combustion engine (ICE) cars in Vietname as well as growing investments in the company’s electric vehicle business. Last year, sales of VinFast ICE cars amounted to 35,700 units, which represents a 20% year-on-year increase from 2020. Despite this, the group’s assembly plant in Cat Hai, Hai Phong, which began operations in 2019, is operating well below its capacity of 250,000 vehicles a year.

Vingroup lost USD1 billion last year in manufacturing due to poor sales of VinFast vehicles, EV investments

VinFast has already said it will stop making ICE-powered cars and transition to become fully electric by the end of 2022. On the electric vehicle (EV) front, Vingroup revealed that VinFast had received nearly 40,000 pre-orders for its EV models after less than four weeks of launch.

The VF e34 is the brand’s first EV model and was launched in 2021. This year, the company will introduce the VF5, VF8 and VF9, while from 2023 onwards, there will be the VF6, VF7, a new sedan model as well as other future models or derivatives.

Vingroup lost USD1 billion last year in manufacturing due to poor sales of VinFast vehicles, EV investments

The push for EVs will see Vingroup invest considerably, including to set up a battery plant as well as establishing sales networks in the United States and Europe. Pham Nhat Vuong, the founder and chairman of Vingroup, told local media that further losses in the automotive business are anticipated in the near term.

Looking at Vingroup’s overall financial performance, the conglomerate recorded a consolidated net loss of roughly VND7.5 trillion (around RM1.38 billion), a first and a significant departure from the VND4.5 trillion (around RM829 million) profit in 2020.

Looking to sell your car? Sell it with Carro.

10% discount when you renew your car insurance

Compare prices between different insurer providers and use the promo code 'PAULTAN10' when you make your payment to save the most on your car insurance renewal compared to other competing services.

Car Insurance

Gerard Lye

Originating from the corporate world with a background in finance and economics, Gerard’s strong love for cars led him to take the plunge into the automotive media industry. It was only then did he realise that there are more things to a car than just horsepower count.

 

Comments

  • mirage on Feb 09, 2022 at 3:19 pm

    crash and burn

    Like or Dislike: Thumb up 3 Thumb down 2
  • Lolwhut? on Feb 09, 2022 at 3:22 pm

    LOL! Will the people accept it?
    Imagine if Proton loses RM 4billion a year. People here would have flip cars not just tables long time ago!

    Like or Dislike: Thumb up 11 Thumb down 1
    • Kunta Bodo on Feb 10, 2022 at 3:33 pm

      Isn’t Vinfast a private company? plus they’re not targeted for the masses like P1 or P2.

      Like or Dislike: Thumb up 0 Thumb down 0
  • Semi-Value (Member) on Feb 09, 2022 at 3:44 pm

    main problem. not many in vietnam can afford a car.

    Like or Dislike: Thumb up 9 Thumb down 1
    • Only the top 1% in Vietnam could afford it and they rather choose Germans or British luxury marques.

      Like or Dislike: Thumb up 4 Thumb down 0
    • YB Albert on Feb 09, 2022 at 9:08 pm

      Semi V..you may be partially correct.
      Vietnamese can afford guns and cheap cars.
      Not what Vinfast is producing.Being a new player is not easy.But seemingly,they have strong financial backers in spite of heavy start up losses.
      They end up like our P1,requiring frequent state bailouts.

      Like or Dislike: Thumb up 3 Thumb down 0
      • Avenger on Feb 10, 2022 at 8:14 am

        Difference is those who criticise P1 don’t get sued or jailed, unlike Vinfast.

        Like or Dislike: Thumb up 2 Thumb down 0
  • Dong Gor on Feb 09, 2022 at 3:59 pm

    Next chapter is to partner up with other drowning brands…

    Like or Dislike: Thumb up 2 Thumb down 0
  • RyanT on Feb 09, 2022 at 4:27 pm

    If change the badge to Toyota, then will sell like hot cakes

    Like or Dislike: Thumb up 2 Thumb down 0
  • Celup King on Feb 09, 2022 at 5:22 pm

    Lucky this was in Vietnam where those who persoal will be jailed. If this happen to Proton, sure kena bash like heck.

    Like or Dislike: Thumb up 9 Thumb down 1
  • Izhar on Feb 10, 2022 at 11:02 am

    Lesson never learnt..

    Like or Dislike: Thumb up 1 Thumb down 0
  • Rakyat Malaysia on Feb 10, 2022 at 4:50 pm

    Vin Diesel’s group?

    Like or Dislike: Thumb up 0 Thumb down 0
 

Add a comment

required

required