VIETNAM REPORT
Vingroup plans to launch a cab business using EVs in the country in April. The founder and chairman of the company has established a new company, owning a 95% stake. The company plans to start the service in Hanoi, the capital of the country, and expand it nationwide within the year. The company also hopes to increase awareness of its products.
The new company, Green and Smart Mobility (GSM), is capitalized at US$ 128 million (VND3 trillion, approximately 17 billion yen) and will develop a cab business using EVs as well as a business that rents EVs and electric bikes to other cab companies, etc. GSM plans to use 10,000 EVs and 100,000 electric bikes.
Source: The Nikkei
PSR Analysis: It has been more than three years since Vinfast began full-scale EV production in 2019. After launching a plant with a production capacity of 250,000 units, while the entire domestic car market in Vietnam at the time was around 400,000 units, the company has been developing its business at an unimaginable speed, as its name implies.
In August 2022, the company announced that it would cease production of its mainstay gasoline-powered vehicles, and that it would concentrate its resources on EVs and pursue a strategy of expanding globally, including in the U.S. and European markets. The company also announced that it would be actively expanding its business in Europe and the United States.
It should be noted that the company is only a small player when viewed globally. However, unlike other automakers, Vinfast’s parent company, Vingroup, has become a leading conglomerate in Vietnam by diversifying its business into education, agriculture, and healthcare, with real estate as its core business.
It is fair to say that the company’s diversified and flexible business style has made its announced cab business possible at an early stage. The core business of an automobile manufacturer is to manufacture and sell automobiles, but Vingroup’s flexibility and willingness to develop new businesses and new markets can serve as a valuable example for other automobile manufacturers. PSR
Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research
