A Vietnamese electric vehicle manufacturer has achieved a remarkable valuation of $85 billion, closely rivalling the combined worth of industry giants Ford and General Motors. This achievement follows a momentous ascent of VinFast shares by over 250% during its debut, led by a Special Purpose Acquisition Company (Spac) on Tuesday. This surge has propelled the company’s value to an impressive $85 billion, significantly exceeding the valuations of Ford ($48 billion), General Motors ($45 billion), and Chrysler Stellantis ($31 billion).
The driving force behind VinFast’s success is its founder and chairman, Pham Nhat Vuong, who not only commands the company but also holds the distinction of being Vietnam’s wealthiest individual. With almost 99% ownership of VinFast, Pham Nhat Vuong’s fortunes have surged to extraordinary heights, elevating his net worth by a staggering $39 billion in a single day, as reported by the Bloomberg Billionaires Index.
However, it’s important to note that VinFast has yet to turn a profit, and its initial shipments of cars to the US market have faced significant criticism. CEO Le Thi Thu Thuy acknowledges the negative feedback and expresses the company’s commitment to incorporating these insights to enhance their vehicle offerings.
In the first half of this year, VinFast’s deliveries reached a modest 11,300 vehicles, paling in comparison to industry giants like Tesla and BYD, who managed to deliver 889,000 and 1.26 million vehicles respectively in the same period.
VinFast’s entry into the public market was orchestrated through a Special Purpose Acquisition Company (Spac), a mechanism where a shell company merges with a publicly traded company. For this purpose, VinFast partnered with the Hong Kong-based blank-check firm, Black Spade Acquisition.
It’s worth noting that the surge in value that often accompanies Spac-led debuts can be short-lived, as witnessed with many Spac-traded companies. As traders seek quick profits, the initial surge could potentially be followed by a market correction. While VinFast’s valuation remains impressive, the company’s sustainability and long-term performance will be closely observed in the evolving electric vehicle landscape.
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