The chairman of Vietnam’s Vingroup conglomerate said on Saturday that the company’s auto unit, VinFast, would seek financing from the US government to support its expansion with a planned plan in North Carolina.
“It is also one of our financing options, but we need to prove to them that we are qualified,” Vingroup Chairman Pham Nhat Vuong told a group including reporters.
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VinFast said this week that its Singapore-based holding company had filed for an initial public offering (IPO) with US securities regulators, as the company readies a $4-billion investment to build a factory in the United States.
VinFast, which began operations in 2019, is betting big on the US market, where it hopes to compete with legacy automakers and startups with two all-electric SUVs and a battery leasing model that will reduce the purchase price.
Vuong said VinFast was committed to an IPO that would help establish the electric vehicle maker as a global brand, but added: “if the conditions are not right we can wait.”
“We ourselves are determined to push and commit to this IPO, but the highest target for the IPO is not financing but to set up VinFast in the global market,” he told the group.
VIETNAMESE CARMAKER TO BUILD ELECTRIC VEHICLES IN NORTH CAROLINA
Lending from the US government’s Advanced Technology Vehicles Manufacturing (AVTM) loan program was another option VinFast was exploring, Vuong said, in response to a question.
The $25-billion fund was established by Congress in 2007 when Detroit-based automakers were tipping into crisis. It is administered by the Department of Energy still has a lending capacity of almost $18 billion, according to its website.
VinFast has promised to create 7,500 jobs at its planned plant in North Carolina, where it will build the battery-powered VF8 and VF9 SUVs. The company has said it plans to begin construction of the plant as soon as permits are granted with a goal of starting production by 2024.
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It plans to begin exporting the two electric vehicles to the United States later this year from its existing plant in Vietnam.
(Reporting by Vietnam Newsroom; Editing by William Mallard, Robert Birsel)