Vietnamese electric-vehicle maker VinFast, which made a splash this week when its shares debuted on the Nasdaq, has stirred a mix of caution and interest among dealers with a recent change in how it will distribute its cars in the U.S. market.
VinFast made its U.S. market debut on Tuesday and shares soared, at one point giving the startup a market valuation of $85 billion - far higher than that of Ford or General Motors at the time. Since then, VinFast shares have retreated, and were down 17.2 per cent at $24.92 at midday on Thursday. Officials at VinFast, which has opened 122 showrooms globally as of June with most in the U.S. West, did not immediately respond to requests for further comment on dealer strategy.
Several dealers said VinFast may need to offer sweetened profit margins to dealers to account for the added risk. On top of that, the automaker may need to provide industry-leading warranty coverage on its vehicles to assure buyers."It is a death strategy," he said of the plan to use dealers."There is too much value extracted by serving dealers. That's a strategy Wall Street will whip them on.