VinFast’s (VFS) EV deliveries grew over 400% in Q2, but there’s a caveat

Vietnamese EV maker VinFast (VFS) announced Monday that EV deliveries rose over 400% in Q2 compared to the first three months of the year. However, the primary reason for the jump is due to sales to a related party.

A closer look at VinFast’s Q2 EV deliveries

VinFast delivered 9,535 electric vehicles in the second quarter of 2023, up 435% from Q1, bringing the total to 11,315 for the first half of the year.

However, of the 11K EVs delivered, 7,310 were for Green and Smart Mobility (GSM), according to Barrons. VinFast’s parent company, Vingroup, established the green transport rental and taxi company in March to promote the use of the automaker’s electric cars and scooters throughout Vietnam.

GSM began operations in April and is expected to expand throughout the region. According to an SEC filing last week, sales of vehicles to GSM accounted for $6.3 million of VinFast’s roughly $84 million in first-quarter sales.

VinFast will release its second-quarter earnings on Thursday, July 21, before the market opens. We will get a closer look at what percent of sales were directly to GSM then.

The Vietnamese EV maker has been trending in the news after its explosive US IPO last month led to a massive valuation, surpassing that of Ford, GM, VW, Rivian, and more.

At one point, VinFast’s market cap was worth $215 billion, more than all four listed above combined. VinFast is worth around $40 billion today, still higher than Rivian ($23B) and Lucid ($13B).

Since hitting a peak of $93 per share in intraday trading on August 28, VinFast stock has fallen over 81%, settling around $17.50.

Electrek’s Take

Although SPACs have been known for their wild price swings, there’s another reason for the volatility. About 99.7% of VinFast’s stock is controlled by Vingroup’s former chairman, Pham Nhat Vuong, leaving an extremely small float (amount of shares available for public trading).

Nearly 1.2 billion of VinFast’s 2.3 billion shares outstanding are held by VinGroup. Another 1.1 billion is owned by Vietnam Investment Group, which Voung is the sole shareholder of, and another investment company (Asian Star) controlled by the leader.

Last week’s filing was to register around 11 million shares in a secondary sale, which will increase the number of shares available for trading. You can already see it having an impact on share prices.