You may not have heard of Vietnamese automaker VinFast yet. But the company plans to change that. And, while plenty of startups have announced plans to enter the U.S. automotive market in recent years, none have moved as fast as this one.
VinFast chose this week’s CES consumer electronics show in Las Vegas to make major announcements so fast that they left journalists dizzy. Among them, the company:
- Showed off five new electric vehicles (EVs)
- Announced plans to cease production of gasoline-powered cars before most Americans were aware they made them
- Launched a new reservation program – customers who spend $200 to reserve a car will receive thousands of dollars in credit toward their final purchase, an NFT, and a free stay at a beach resort in Vietnam. Read it again. It won’t make more sense the second time.
Let’s Back Up
So… what’s VinFast?
Founded in 2017, VinFast is the first Vietnamese car brand to market cars outside that country’s borders. It’s a subsidiary of VinGroup, Vietnam’s largest conglomerate, which does business in fields as varied as real estate and healthcare. VinFast launched with just two products – a midsize sedan and a midsize SUV, both evolved from previous-generation BMW vehicles. But the company has been planning aggressive growth. It now has offices on five continents, with plans to sell vehicles in each.
Going All-Electric
The company this week announced plans to “stop producing vehicles with internal combustion engines by the end of 2022.” Instead, it will “focus research and development efforts on all-electric powertrains” for future vehicles.
Of course, most Americans weren’t aware of VinFast when it was producing gasoline-powered cars. So Americans will likely experience the company as a pure EV producer to begin with.
A Full Lineup
VinFast used CES to show off five vehicles. Their exteriors were all penned by famous Italian design firm Pininfarina, and the Vietnamese company will sell them with a unique ownership strategy.
Buyers will purchase the car but lease the battery. That system, VinFast says, will allow the company to replace any battery that falls below 70% of its capacity over time. The company hasn’t revealed what leases will cost, other than to say that “The total monthly cost for driving VinFast EVs is approximately equal to gasoline costs.”
Since one of the major arguments for buying an EV is that electricity costs less than gasoline, that strategy may require some adjustment.
VinFast has said there would be two tiers to the battery lease program – one that allows up to 300 miles of driving per month and a second without mileage limits.
The vehicles include:
- The VF5, a subcompact SUV, price unknown
- The VF6, a compact SUV, price unknown
- The VF7, a 2-row SUV splitting the difference between compact and midsize, price unknown
- The VF8, a midsize, 2-row SUV starting at $41,000, not including the monthly cost of the battery lease
- The VF9, a midsize, 3-row SUV, starting at $56,000, not including the monthly cost of the battery lease
A Unique Reservation Program
Buyers can purchase a reservation for the vehicles today for $200. Reservation holders earn the right to order the vehicles when they are ready, plus a unique set of perks. They include a “voucher” worth between $3,000 and $5,000 toward the final purchase price, a Non-Fungible Token (NFT) based on the vehicle’s ID, and…ok… we’ll just start quoting now:
“A free resort tour package (excluding air ticket) of 3-bedroom beach villa for four persons in seven days at one or multiple VinPearl’s hotels in Vietnam, including airport pickup service, accommodation, unlimited free admissions to VAP, Safari, or Golf.”
Oh, and a charger. You get a free portable charger. Presumably for the car, but the press release doesn’t say for certain.
Is This Real?
It’s a lot to digest. We’ll note that, just a decade ago, startups in the automotive industry were almost unheard of. In the last few years, Tesla has grown from a questionable proposition to the world’s most valuable automaker (at least in terms of market capitalization). Startups Lucid Motors and Rivian have successfully delivered cars to customers.
Even Sony is getting into the act.
As the project of a major conglomerate, VinFast has more resources at launch than any of them did. But it’s attempting many new ideas all at once, with almost no infrastructure in the U.S. to support them. It’s anybody’s guess whether this succeeds.
The company has no U.S. dealerships or service locations yet and has not explained how it plans to sell or service its cars.
“All early reservations can be refunded, gifted, or transferred from April 6, 2022,” VinFast says.
