VinFast Auto .(US:VFS)2024-11-26 16:00Financial Data and Key Metrics - Q3 2024 net revenue was $512 million, a 42% quarter-over-quarter and 49% year-over-year increase [34] - Gross loss in Q3 2024 was $123 million, with a gross loss margin of -24%, a significant improvement from Q2 2024's gross loss of $226 million and gross margin of -62.7% [34] - EBITDA in Q3 2024 was -$232 million, with an EBITDA margin of -45.3%, improving from -$484 million and -134.4% in Q2 2024 [38] - Net loss for Q3 2024 narrowed to -$550 million, a 29% quarter-over-quarter and 15% year-over-year improvement [38] - CapEx in Q3 2024 was $132 million, a 21% increase quarter-over-quarter and a 33% decline year-over-year [39] Business Line Performance - EV deliveries in Q3 2024 reached 21,912 units, a 66% quarter-over-quarter and 115% year-over-year increase [11] - e-scooter deliveries in Q3 2024 were 18,894 units, a 44% sequential increase and a 33% year-on-year decrease (118% increase excluding GSM deliveries) [11] - B2C electric car sales grew 163% quarter-over-quarter and 497% year-over-year in Q3 2024 [11] - The accessible segment, including VF 3 and VF 5, accounted for 35% of Q3 2024 revenue [34] Market Performance - Vietnam retail sales grew 159% quarter-over-quarter and 504% year-over-year in Q3 2024, driven by VF 3 and VF 5 [12] - North America saw three consecutive months of growth in July, August, and September, with sales up 70% quarter-over-quarter [17] - International markets accounted for 9% of deliveries in Q3 2024, up from 3% a year ago [16] - Indonesia became an official market in Q3 2024, with the first deliveries of VF e34 and VF 5 [21] Strategy and Industry Competition - The company is focusing on balancing growth and profitability while responding to market opportunities [10] - VinFast is leveraging its home market success in Vietnam to drive overseas expansion and develop long-term expertise [15] - The company is introducing new models like VF 9 in North America and planning to launch VF 6 and VF 7 in 2025 [18][19] - VinFast is expanding its dealership network, with 173 showrooms globally as of October 31, 2024 [27] Management Commentary on Operating Environment and Future Outlook - The company expects to achieve its 2024 delivery target of 80,000 vehicles, with strong momentum in October and November [31] - VinFast is preparing for a growth trajectory in 2025, with new market entries and product launches [43] - The company is committed to long-term competitiveness and sustainability in the EV industry [44] - VinFast is focusing on cost optimization and improving profitability while maintaining customer experience [33] Other Important Information - VinFast customers have access to over 1 million charging points globally, including VinFast-owned stations and third-party options [29] - The company recently announced a $3.5 billion capital injection, including $1.4 billion in loans from Vingroup and $2.1 billion in grants from VinFast Founder [31] - VinFast is planning its first-ever Investor Day in the first half of 2025 [105] Q&A Session Question: Confidence in hitting the full-year 2024 delivery target - The company is confident in achieving the 80,000 delivery target, with strong performance in October and November [47] Question: BOM optimization and its impact on EV architecture - VinFast is focusing on optimizing BOM costs, including ADAS features and sourcing components, while prioritizing safety [48][49] Question: Liquidity and cash runway following the $3.5 billion capital injection - The $3.5 billion capital injection will be deployed over two years, with funds allocated to CapEx, debt repayment, and R&D [53][54] Question: Gross margin improvement and path to positive gross margins - The company maintains its forecast for positive gross margins in 2025 and 2026, with more guidance expected at the end of the quarter [59] Question: Rationale for the new CKD facility in Vietnam - The new CKD facility is dedicated to meeting the growing demand for VF 3 and VF 5, which are best-selling models in Vietnam and other markets [65][66] Question: Contribution of the Vietnamese market to overall deliveries - Vietnam contributed around 90% of total deliveries in the first nine months of 2024, with significant growth in EV adoption [71] Question: ASP trends and focus on lower-priced models - ASP in Q3 2024 was $21,000 per unit, down 10% from Q2, driven by the introduction of VF 3. The company expects ASP to rise as EV adoption matures [74][75] Question: Dealer feedback on VF 9 in the U.S. - The VF 9 is expected to be a strong competitor in the U.S. market, targeting large families with its premium quality and value [76] Question: Deliveries to GSM and future guidance - GSM accounted for 22% of total volume in Q3 2024, down from 46% in Q1, as the company shifts focus to retail and B2B customers [79][80] Question: Ramp-up plans for 2025 in Indonesia and the U.S. - VinFast expects to continue growing in international markets, with a focus on balancing growth and profitability [87][88] Question: Charging solutions in new markets - VinFast is leveraging its V-Green network and partnerships to provide comprehensive charging solutions globally [97][98] Question: Key milestones for 2025 - Key milestones include diversifying product offerings in North America, launching GSM in Indonesia, and opening new CKD facilities in Indonesia and India [103][104]