VinFast (VFS) expects continued sales to taxi service owned by founder into 2024

VinFast's (NASDAQ: VFS) CEO, Le Thi Thu Thuy, has stated that the company anticipates the ongoing sales of electric cars and scooters to a connected ride service, owned by the founder, to persist throughout 2024.

"For the next two quarters we still see GSM having demand for our vehicles, both EVs and e-scooters," Thuy said. "That is going to continue into end of first quarter, even maybe the second quarter next year."

VinFast has successfully marketed roughly 13,000 electric vehicles to Green SM (GSM), a Vietnamese taxi operator and leasing service predominantly controlled by VinFast's billionaire founder, Pham Nhat Vuong.

The sales to Green SM accounted for roughly two-thirds of VinFast's total electric vehicle sales. This substantial portion of sales directed towards Vuong's enterprise triggered inquiries from both analysts and investors during the company's recent earnings call.

Thuy, in an interview, clarified that VinFast hadn't offered any financial assistance to GSM. She highlighted that the company had granted a standard 10% fleet discount, consistent with what it would typically offer for such transactions. Thuy also expressed the belief that more customers would be inclined to consider purchasing a VinFast electric vehicle after experiencing a ride as a passenger.

"The terms are exactly like the other business-to-business customers." Said Thuy.

According to Thuy, a survey conducted by VinFast revealed that passengers who had taken a ride in a VinFast taxi operated by GSM were four times more likley to purchase one of their vehicles compared to customers who underwent standard test drives.

Earlier this year, GSM initiated Vietnam's first exclusive electric vehicle taxi service. The company also outlined plans for expansion beyond the borders, with Laos being the initial target for its overseas ventures.

Shares of VFS are down 5.78% in early trading Thursday morning.

By Michael Elkins | [email protected]

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