Vietnamese electric-vehicle manufacturer VinFast’s recent change in its distribution model for the U.S. market has prompted a mix of caution and interest among dealers. VinFast, which made its U.S. market debut on Tuesday when its shares debuted on the Nasdaq, has been shipping vehicles to North America since late last year using a direct-to-consumer approach. However, the company is now seeking to sell through dealers as well.
While several U.S. dealers have expressed openness to the idea, they are awaiting more details about VinFast’s plans. Dealers want more information on VinFast’s sales strategy, requirements for dealers, the company’s parts distribution plan, and the vehicle warranty. George Glassman, president of Glassman Automotive Group, stated, “I’d need to see more before I could make an intelligent decision.”
VinFast’s shares initially soared after its market debut, reaching a valuation of $85 billion. However, shares have since retreated, falling 33.6% at $20 as of Thursday’s close. The company is now in talks with dealers as it faces the challenges of its new hybrid sales plan. VinFast’s CEO Le Thi Thu Thuy stated, “Opening our own stores is great but it takes a lot of time.” The company plans to partner with dealers to accelerate its growth.
Dealers in the U.S. have raised concerns about unanswered questions, such as how VinFast will distribute parts needed for repairs. Scott Fink, CEO of Fink Automotive Group, also highlighted the importance of preserving a dealer’s reputation and providing industry-leading warranty coverage for buyers to instill confidence in the brand.
VinFast will be competing with established brands that already have their own electric offerings, such as GM, Ford, and Hyundai. Some dealers have questioned whether VinFast will be able to sustain its business in the long term.
However, others believe that VinFast could succeed in the U.S. market. Rhett Ricart, CEO of Ricart Automotive Group, stated that many dealers appreciate the fact that VinFast is building a U.S. plant and believes that if the product is good with a great warranty, Americans will buy it.
Ultimately, dealers are always on the lookout for unique opportunities, and many are willing to take risks. Beau Boeckmann, president of Galpin Motors, remains open to the opportunity after visiting VinFast’s plant in Vietnam last year and meeting with CEO Thuy. He believes that dealers are entrepreneurial and sales-oriented.
As VinFast works to define its new distribution model and engage potential partners, more details about its plans will be announced in due course.