On May 11, Vingroup held the Annual General Meeting of Shareholders in 2022. At the meeting, most of the questions from shareholders were related to VinFast’s story, such as the production and business situation, battery factory, battery recycling… These questions were all personally answered by Vingroup Chairman Pham Nhat Vuong.
Regarding production and business, Mr. Vuong said, the factory in the US is designed with a capacity of 150,000 vehicles/year. In 2022, the plan is 17,000 vehicles and the US order portion is already 4,000 vehicles. By 2026, the sales plan is up to 750,000 vehicles, so then it is estimated that 600,000 vehicles manufactured from Vietnam will be exported to the US market.
The area of Vung Ang project of Vingroup is currently 1,500 hectares. According to Vingroup’s chairman, in the future, this area can be expanded even more, for VinFast and VinES, but most of it will be for businesses producing components for cars. “We want to strongly develop an auxiliary industry for cars,” affirmed Mr. Pham Nhat Vuong.
In addition, not only in Vung Ang but also other industrial real estate of Vingroup will aim to invite investors to produce components, first giving priority to electric vehicles, then other parts.
Currently, VinFast’s localization level has reached about 60% and in the future will progress to about 80% localization according to the standards announced now.
Raw material shortage
Mr. Pham Nhat Vuong said that currently, the shortage of materials, covers, solvents … is not a problem when the production scale is 100,000-200,000 cars/year. However, in the future when the scale of production increases, materials will become a big problem.
In addition to Lithium, which is used to make batteries, nickel, cobalt and things like graphite are also in short supply. Vingroup has made a list of 6 groups of components and materials for battery cells and started researching to have long-term strategic reserves.
We will have to find contacts, cooperate with us to solve from the source of raw materials, cooperate with mining companies, order in bulk, with a long-term plan. This is a great concern of Vingroup at the moment.
Inviting chip manufacturers to open factories in Vietnam
Vingroup chairman said that, with VinFast, now is a golden opportunity to dominate the market, build a brand, build a position and Vingroup is very fierce day and night, solving the search for each component, each supply.
“Now everything is lacking, like the VF e34 car without only 1 stamp, it cannot be shipped. A car with 4,000 components, 40,000 components, only missing 1 screw and 1 screw, cannot be exported. This is a huge challenge,” said Mr. Vuong.
Part of VinFast’s goods must be imported from China because this is the world’s factory. However, when Shanghai closed, and chip factories around the world closed, the chip supply was cut off.
To solve this problem, Vingroup is promoting a very strong component localization strategy. “We are inviting chip manufacturers to open factories in Vietnam. Vingroup even has great incentives for them: free land rent, 10-15 year factory rent exemption so they can invest. then we will be able to solve the supply problem, and when the supply is guaranteed, we will develop very quickly.The world now only has a shortage of cars, not a surplus of cars. will sell very quickly, and we will be very aggressive in promoting this story,” said Mr. Pham Nhat Vuong.