On April 25th, the Vingroup Corporation (stock code: VIC) held its annual General Meeting of Shareholders for 2024. At the meeting, the corporation was asked about the competitiveness of VinFast electric vehicles against gasoline-powered and other electric vehicles in the global market.
In response, Mr. Pham Nhat Vuong, Chairman of Vingroup, said that electric vehicles will never become obsolete and are the way of the future. He stated that new battery technologies are constantly being developed, which will gradually reduce the cost of batteries and, consequently, the cost of electric vehicles. He believes that electric vehicles will eventually become as affordable as gasoline-powered vehicles.
“Especially with VinFast, we have a policy of leasing batteries. This means that we are competing directly with gasoline-powered vehicles. Currently, VinFast’s non-battery-included vehicles are being sold at a lower price than gasoline-powered vehicles in the same segment. However, VinFast’s vehicles are more powerful, more intelligent, and have more advanced technology,” said Mr. Pham Nhat Vuong.
According to Mr. Pham Nhat Vuong, the cost of renting a battery or charging an electric vehicle is 40-50% lower than the cost of gasoline per kilometer. Therefore, it can be said that VinFast electric vehicles are directly competing with gasoline-powered vehicles, and their maintenance and repair costs are also lower.
In addition to being cost-effective, electric vehicles also contribute to environmental protection. “Imagine if the entire country drove electric vehicles; our environment would be much cleaner. Electric vehicles are an important part of making our major cities cleaner,” said Mr. Pham Nhat Vuong.
Many people do not yet understand how environmental issues directly affect their lives. The billionaire said that allergies, respiratory illnesses, and cancer are becoming more common, and healthcare costs are rising dramatically as a result of pollution. If Vingroup does not produce electric vehicles now, future generations of Vietnamese will not have healthy lives or a strong economy. Electric vehicles are undoubtedly the future.
Overview of the Vingroup convention.
Mr. Vuong also believes that electric vehicles are not yet popular in Vietnam because their benefits have not been adequately promoted and communicated. However, he and Vingroup will be stepping up their communication efforts in the near future.
“I will invest an additional 10,000 billion VND to triple the number of charging stations in Vietnam,” said Mr. Pham Nhat Vuong. He also said that increasing the number of charging stations will give people more confidence in buying electric vehicles. Citing a report, the billionaire said that over 90% of people drive less than 100km per day, and VinFast electric vehicles can travel 400km to 500km on a single charge, depending on the model. Therefore, charging at home can meet most people’s needs.
Mr. Pham Nhat Vuong also said that the world’s largest electric vehicle company, Tesla, is facing intense competition, so a decline in its stock price is inevitable. The position of the market leader is always stressful and difficult to maintain.
The billionaire also asserted that VinFast is growing stronger every day. Every day, the company comes up with new innovations to make its vehicles better, cheaper, and more efficient to produce. VinGroup’s successful mobile phone business is the foundation for VinFast, allowing more people to experience VinFast vehicles.
Sharing more about future plans, Mr. Pham Nhat Vuong said that the company will start taking orders for the VinFast VF3 in June. This vehicle is not only designed for housewives but also for young people. However, its price will be very reasonable. This A-segment vehicle is expected to create excitement and competition in the market.
The billionaire also shared that VinFast could achieve EBITDA breakeven in 2026 and gradually become profitable. Some markets are already profitable, but these profits are based on three “noes”: no depreciation, no profit, and no financial expenses. This means that the company’s investment is not counted as an expense. Gradually, the company will factor these costs into the price of its vehicles. Cash flow will be positive from 2026 onwards.
Producing electric vehicles is a very challenging task, and the production process is completely different from that of gasoline-powered vehicles. Electric vehicles are complex systems with multiple software components that must work together. Many companies have been unable to produce electric vehicles or have taken a long time to do so because these
