VinFast is “given” a battery manufacturer

The Vietnamese Vingroup is restructuring. Carmaker VinFast and battery company VinES will no longer be sister companies but parent company and subsidiary.

Image: VinES

EV manufacturer VinFast will soon have its own battery company. 99.8 per cent of Vines Energy Solutions (VinES) shares, part of the Vietnamese Vingroup, will be transferred to the carmaker. As part of the merger, VinFast will acquire all of VinES’ intellectual property related to battery cells and battery packs and will take over the production facilities, partnerships and supplier contracts.

Vingroup’s Chairman, Pham Nhat Vuong, announced that he will donate almost the entire company to VinFast to “enhance [VinFast’s] self-efficiency in battery technology and leverage resources to increase battery research and development for its vehicles.”

Following the gift, VinES will be merged with VinFast. The merger is expected to “create an unparalleled competitive advantage for VinFast in the global electric vehicle market,” according to the original statement.

According to its parent company Vingroup, VinES has a registered capital of 6,500 billion VND, equivalent to about 250 million euros. The company specialises in R&D and the production of lithium-ion batteries for mobility and energy storage applications. To this end, VinES works with partners such as the Israeli battery developer StoreDot or the Chinese battery manufacturer Gotion High-Tech.

For its part, VinFast delivered more than 10,000 electric cars for the first time in the just-ended third quarter of 2023 – 10,027 units, to be precise. However, sales are only rising slowly, while the net loss can hardly be contained. That is why VinFast also needs a steady supply of capital. In spring, the Vietnamese electric car maker secured up to $2.5 billion in fresh capital to drive its global expansion: $1.5 billion in grants from parent company Vingroup and its chairman Pham Nhat Vuong, and another billion over five years in loans from Vingroup. VinFast received some of this money, according to its Q3 annual report. It received another $240 million in Q3 from the SPAC transaction (the US IPO was in August 2023) and a private strategic investment from Gotion. According to VinFast, its cash and cash equivalents amount to €124 million as of 30 September 2023.

VinFast aims to offer its vehicles in up to 50 global markets and countries by the end of 2024. The company still aims to deliver 40,000 to 50,000 cars in the current financial year. Order books for the VF 6 are scheduled to open in the domestic market on 20 October, with the launch of the VF 7 and VF 3 models to follow in 2024.

“The acquisition of VinES will help VinFast control our battery technology and supply chain, thus optimising operating expenses and enriching technology content in our electric vehicles,” says Le Thi Thu Thuy, Vice Chairman of Vingroup and Global CEO of VinFast. “This is also an important step towards developing and controlling an integrated supply chain as well as a comprehensive manufacturing system to further strengthen our competitiveness.”


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