Vietnam’s VinFast says it has secured $4 billion financing deal for electric vehicle factory with Credit Suisse and Citi

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A VinFast electric SUV VF8 model is displayed at a store the Vietnamese automaker plans to open in Santa Monica, California, U.S., May 23, 2022. REUTERS/David Swanson

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HANOI, July 13 (Reuters) – Vietnamese automaker VinFast has signed framework agreements with Credit Suisse (Singapore) Ltd and Citigroup Global Markets Inc. to raise at least $4 billion to develop an electric vehicle factory in Carolina from the North, the company said.

The announcement comes after its parent company Vingroup JSC (VIC.HM) said in May that an initial public offering (IPO) for VinFast could be delayed until next year due to market uncertainty. Read more .

The company did not specify the type of debt it would incur. Credit Suisse and Citi did not immediately respond to requests for comment.

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VinFast, which launched operations in 2019, is betting big on the US market, where it hopes to compete with traditional automakers and startups with two all-electric SUVs and a battery-leasing model that will lower the purchase price.

The North Carolina plant, which covers an area of ​​800 hectares, will initially produce 150,000 electric vehicles per year, the company said.

VinFast promised to create 7,500 jobs at the factory and said it aims to start production by 2024.

The company said it was set to open its first overseas showrooms in California in the coming days, including a flagship store in Santa Monica.

For the North Carolina plant, it has also sought support from US President Joe Biden’s administration for possible funding through a fund for high-tech vehicles.

Additionally, VinFast has filed for an IPO in the United States through a shell company in Singapore that now legally owns nearly all of the startup automaker’s assets.

Vingroup is Vietnam’s largest publicly traded company by market capitalization, with operations in retail, real estate and resorts. He created VinFast in 2019 to build conventional combustion engine cars before moving exclusively to electric vehicles in 2021.

Despite its cold start in an increasingly crowded market for electric vehicles, VinFast has won support from vendors, some analysts and the Biden administration, in part because of the perception that it is a national champion. rising in Vietnam.

In late March, Biden tweeted that the US investment plans then announced by VinFast were “the latest example of my economic strategy in action.”

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Reporting by Phuong Nguyen and Anshuman Daga in Singapore; Writing by Khanh Vu Editing by Ed Davies

Our standards: The Thomson Reuters Trust Principles.

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