VinFast, a prominent electric car manufacturer, has unveiled a bold strategy to supply one million electric vehicles (EVs) to Green SM, a rising ride-hailing service, by 2030. In addition to this, the deal stipulates the addition of four million electric motorcycles to Green SM’s fleet. The announcement was made in VinFast’s first quarter financial report.
The venture is viewed as a strategic collaboration between the two companies, with anticipated benefits for both parties. For VinFast, this partnership signifies a promising opportunity to broaden its international distribution network and augment its brand recognition. Concurrently, it bolsters Green SM’s ambitions to expand its global reach.
Green SM has recently initiated taxi services in India, marking its fourth international market entry, following Laos, Indonesia, and the Philippines. Pham Nhat Vuong, recognised as Southeast Asia’s wealthiest individual, controls both companies. Green SM was launched in 2023 with a starting capital of $113.9 million, which has since grown exponentially to $1.94 billion.
Initially, Green SM focused on taxi services and technology-based ride-hailing services, exclusively using VinFast vehicles. However, the company has expanded its offerings to include services such as food and parcel delivery, as well as car and motorcycle rentals.
VinFast experienced substantial financial success in the first quarter, reporting a revenue increase of 42% to $1.04 billion. This surge was primarily attributable to a marked increase in electric vehicle sales both within Vietnam and in international markets, including Indonesia and the Philippines.
Within the first quarter, VinFast sold 58,600 electric cars, reflecting a year-on-year increase of 61%. Moreover, the company sold 143,000 electric motorcycles and bicycles in the same period. Despite this success, VinFast reported a loss exceeding $1.26 billion, an increase from the previous figure of $798 million.
In 2023, Vuong anticipated that the company would experience losses for several years. However, there is now a more optimistic outlook, as the company expects to break even next year following the decision to spin off its manufacturing operations to a separate company owned by a consortium of private investors.
What is VinFast’s strategy for its collaboration with Green SM?
VinFast plans to supply one million electric vehicles and four million electric motorcycles to Green SM by 2030, expanding its international distribution network and enhancing brand recognition.
What services does Green SM offer?
Green SM provides taxi services and technology-based ride-hailing services. The company has also expanded to offer food and parcel delivery, as well as car and motorcycle rentals.
What is the financial outlook for VinFast?
Despite experiencing losses, the company anticipates breaking even next year. This follows a decision to spin off manufacturing operations to a separate company owned by private investors.
