VinFast delaying break-even target to after 2027 due to growth push, sources say

Vietnamese electric vehicle maker VinFast VFS.O now expects that it will only break even after 2027 as it pushes ahead with plans to expand rapidly while also dealing with rising costs, two people with direct knowledge of the matter said.

The Nasdaq-listed startup has made forays into Indonesia, India and the Philippines, although it has downsized initial growth ambitions in the U.S. and Europe. The expansion has been expensive, however, with VinFast posting a net loss of almost $4 billion last year.

VinFast, which turned fully electric in 2022, initially targeted profitability at the gross income level by 2024, before postponing that goal to this year.

A spokesperson for VinFast did not offer the company's latest position on its timeline for breaking even but noted analysts' expectations.

"There is a consistent view across our analyst coverage that gross profit breakeven could come into sight around the 2027–2028 timeframe," the spokesperson said.

Two analysts polled by LSEG show they currently expect the automaker's gross income to swing to a profit in the third quarter of next year.

The sources spoke on condition of anonymity as the information has not been publicly disclosed.

VinFast is targeting global deliveries of 300,000 cars this year, up 50% from 2025, and expects e-scooter deliveries to rise 2.5-fold, helped by a planned mid-year ban on petrol-powered motorbikes in central Hanoi.

The spokesperson said rising global fuel prices, driven in part by the Iran war, could boost EV adoption and that scaling its operations will make its path to profitability "increasingly visible over the medium term."

VinFast is the biggest seller of cars in Vietnam, supported by the rollout of lower-priced models, large deliveries to Vingroup-affiliated companies, and generous free-charging programmes for new buyers.

But it faces intensifying competition at home from Chinese EV brands such as BYD 002594.SZ and Geely 0175.HK.

The carmaker relies on financial backing from founder Pham Nhat Vuong and its parent company Vingroup VIC.HM, the country's largest conglomerate by market capitalisation and which is controlled by Vuong.

As of November 2024, Vuong and Vingroup's pledged funding to VinFast had reached $17 billion.

-Phuong Nguyen/Reuters