Bearing the VinFast nameplate, Vietnam’s first major domestic automaker is fast-tracking its efforts to recruit and train a skilled workforce while assembling a roster of international vendors. Production-scale sales of two models – a sedan and SUV – are scheduled to rollout in September of 2019.
The company’s duo of prototype designs drew rave reviews from the worldwide auto press during their respective debuts at October’s Mondial de l’Auto – the Paris Motor Show.
“We have the resources, scalability and commitment to become a significant new player in the global automotive industry,” says VinFast CEO James DeLuca. “We are immensely proud to be the first volume-automotive manufacturer in Vietnam, and the first to participate in a major international motor show.”
The initial marketing initiative will cover Vietnam and nearby Southeast Asian nations with plans to subsequently export to additional foreign destinations. VinFast branch offices are located in Frankfurt, Shanghai and Seoul.
Engineering, design, production and vendor partnerships with General Motors, Lear Corp., BMW, Bosch, Magna Steyr, ZF Friedrichshafen, AVL, EDAG, AAPICO, Pininfarina, Italdesign Giugiaro, LG Chem and other global firms are aimed at providing a “Vietnamese identity” for vehicles further enhanced by “Italian design, European technology and international standards.”
“The strong, distinguishable design, enhanced by elegant lines and refined details, gives our cars several distinctive highlights,” explains VinFast Design Director David Lyon. “First and foremost, these emanate around the V logo in the grille which references the country of Vietnam as well as the Vingroup and VinFast brands.”
Vingroup – Vietnam’s largest privately owned conglomerate with vast holdings in construction, real estate, education, healthcare, agriculture, tourism and retail – is VinFast’s parent firm, posting 2017 revenues of $3.8 billion.
Vietnam’s annual GDP (gross domestic product) per capita growth has accelerated in recent years to exceed 6.8 percent and is forecasted to continue at a 6.5 percent rate for at least the next three years.
The company anticipates “a major boom in the passenger car market.” Current vehicle ownership is 23 cars per 1,000 people, compared to 204 cars per 1,000 people in neighboring Thailand and 790 cars per 1,000 people in the United States.
“Estimates suggest the ownership of cars in Vietnam will grow to 50 per 1,000 in the next few years, as a result of a rapidly growing middle class, continued economic growth and major investments in the national road infrastructure,” according to DeLuca.
Up until now the Vietnamese auto industry has mostly consisted of Asian OEMs assembling CKD (complete knock-down)models to avoid import tariffs that have since ended under a recent ASEAN trade agreement. (The 10 member states of the Association of Southeast Asian Nations are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.)
“Vietnam needs its own car brand in order for the industry to develop and thrive,” DeLuca notes. “It will also serve as a signal to the rest of the world that the country is undergoing an economic transition to high-value industries, and that it is becoming a strong trading force in Southeast Asia.”
World-class production
More than 400 engineers have been creating platforms for each of the inaugural editions, incorporating extensive use of aluminum and hot-stamped ultra-high strength steels.
Upwards of 62,000 Vietnamese citizens voted in a poll that presented 20 design sketches for choosing the overall winning appearance concepts for both the sedan and SUV. Testing of 300 developmental vehicles revolving around a turbocharged 2.0-litre inline four-cylinder gasoline engine is currently underway in Vietnam and Europe. Slated also is an eventual wide range of VinFast-branded electric cars, buses and scooters.
Per a June agreement, VinFast has assumed full ownership of GM’s Hanoi plant with the goal of producing a line of GM-licensed small cars starting in 2019. VinFast now has exclusive Vietnamese distribution rights for the Chevrolet brand plus other cooperative ventures, such as GM becoming a preferred technology provider.
“The automotive industry in Vietnam is set to become a key growth engine for economic development and we now have the strongest possible local partner in VinFast to grow Chevrolet and drive our brand forward,” says GM International President Barry Engle. “The GM-VinFast strategic partnership will best position the Chevrolet brand and dealer network for long-term growth in Vietnam by leveraging GM’s global scale and expertise, married with VinFast’s domestic strength and insight.”
“This partnership will act as a catalyst as we work tirelessly to bring our VinFast vision to life,” DeLuca points out.
In September of 2017 VinFast broke ground for a purpose-built 800-plus acre (36 million sq.-ft.) plant now nearing completion on a site partially reclaimed from the sea near the major port city of Hai Phong, northern Vietnam. (With the civil war having ended in 1975, North Vietnam and South Vietnam no longer exist as separate entities; they are now united as one nation.)
DeLuca reports that the ultra-modern $1.5-billion VinFast factory is one of Vietnam’s largest-ever industrial projects, encompassing state-of-the-art construction and world-class production equipment and manufacturing processes. Data collection and management systems, interconnected sensors and cloud servers are being supplied by Siemens and SAP.
Schuler, FFT, EBZ and Hirotec are outfitting the stamping and body production lines as ABB is supplying more than 1,200 robots. Eisenmann’s assembly and finishing line installations include a highly automated and flexible array of conveyor belts and self-propelled trucks that allow multiple models to be assembled at the same time. Dürr is the primary painting partner, while the engine shop has been engineered and equipped by GROB, Thyssenkrupp, AVL and MAG IAS.
Further vendor relationships are being pursued to put together a dedicated “supplier park” within the vast complex. According to DeLuca, “This space will enable VinFast to support the ongoing development of the automotive supply chain in Vietnam and increase the locally-supplied content” for its factory.
VinFast is partnering with Eckert-Schulen to annually train 200 apprentices at a purpose-built onsite training center. With courses in Industrial Mechanics and Mechatronics adhering to German engineering standards, graduates will receive a certificate issued by the German Chamber of Commerce and Industry.
