Amidst a rapidly evolving automotive landscape, VinFast, Vietnam’s premier electric car manufacturer, has significantly fortified its position through a strategic consolidation. With Vingroup Chairman Pham Nhat Vuong leading the charge by donating a staggering 99.8% of his shares in VinES Energy Solutions Joint Stock Company, VinFast is poised to make notable advancements in the electric vehicle (EV) market.
Creating a Nexus of Technology and Production
The integration of VinES into VinFast is more than a mere merger; it’s a decisive move towards achieving autonomy in battery technology and ensuring that production efficiency meets innovative standards. This heightened self-sufficiency positions VinFast at a vantage point in the competitive arena of electric vehicles, where battery proficiency is key.
Expanding Expertise in Battery Innovation
With a robust legal capital of VND 6,500 billion ($270 million), VinES shines as a beacon of innovation, spearheading the research and development (R&D) of cutting-edge lithium-ion batteries. Apart from laying the groundwork for mobility solutions, VinES is on a mission to evolve into a full-spectrum energy solution provider, a journey that further reinforces VinFast’s EV offerings.
Securing a Competitive Advantage
Beyond the amalgamation of resources and expertise, the terms of the merger afford VinFast exclusive access to pivotal intellectual property—including cells, packs, and crucial technology, which propels the automaker towards completing a fully integrated production chain. This move equips VinFast with a unique edge in the global electric vehicle market that is unmatched.
Le Thi Thu Thuy, Vingroup Vice Chairwoman and Global CEO of VinFast, encapsulates the strategic significance of the move, stating its role in controlling technology and supply chain elements which, in turn, will optimize costs and enrich the technological prowess of their EVs.
Philanthropic Pledge Propels Progress
In a testament to their commitment, Pham Nhat Vuong’s personal $1 billion donation in April 2023, supplements Vingroup’s sizeable contributions to VinFast’s ambitious expansion dreams. These funds, which encompass grants and a guaranteed loan, are strategic investments to accelerate growth and establish VinFast’s global presence.
VinFast’s Pioneering Battery Factory in Vietnam
The Vung Ang Economic Zone in the Ha Tinh province of Vietnam is now home to a groundbreaking joint venture between VinFast and Gotion High-Tech. This factory, gearing to commence production in 2024, is set to be a cornerstone of innovation, focusing on the cost-effective and durable lithium iron phosphate (LFP) battery cells.
Amidst the Pandemic, an Unwavering Commitment to Innovation
In 2021, even as the pandemic raged on, Vingroup invested over VND4 trillion ($174 million) into the creation of the VinES battery factory, a testament to their dedication to powering VinFast EVs. In collaboration with Gotion Inc., a second factory is now in development, representing another significant financial commitment to the future of electric mobility.
Vietnam Emerges as a Hub for Battery Manufacturing
The emergence of battery factories from major players like LG Chem and Samsung SDI indicates a larger shift towards Vietnam becoming a hub for EV components, a transition strongly encouraged by government support and mitigated by the country’s competitive labor costs.
The ambition manifest in the VinFast battery factory signals a boon for not only the Vietnamese automotive industry but also the global EV market, promising to drive down costs and broaden consumer accessibility to electric vehicles.
