Media: Vietnamese electric car manufacturer VinFast closes showrooms in Europe
VinFast is apparently planning a complete reorganisation of its European business. According to media reports, all showrooms and service centres in Europe are to close by the end of this week.
Here's What We Know
Two insiders confirmed to German website Elektroauto-news that nearly 90 per cent of VinFast's employees in Europe received layoff notices in early May. At the same time, an internal staff meeting was held on 2 May to discuss further plans.
The timetable presented at the meeting looks very concrete: the showrooms are scheduled to close on 9 May, with contracts to be terminated by 22 May. Liquidation of assets will follow in the second quarter together with the cancellation of lease agreements.
VinFast is currently represented in Europe in the markets of Germany, France and the Netherlands.
Vinfast's action plan in Europe. Illustration: Elektroauto-news
The reasons cited are "macroeconomic conditions, tariffs, trade disputes and general uncertainty". Elektroauto-News.net quotes directly from an internal document: "Continued uncertainty makes it impossible to continue [operations] - the direct sales model no longer works."
The direct sales model is the key point here. When VinFast entered the European market, following Tesla's lead, it sought to sell its cars directly to customers through a small number of its own outlets. This strategy is now being abandoned. It is likely that VinFast models will be sold through dealers in the future.
This also explains why not all 100 per cent of the staff have been sacked - the remaining will reportedly be transferred to new retail partners. However, the names of these partners have not been disclosed. It is currently unclear if such partnerships even exist.
VinFast vehicles at the ON Drive Summit. Photo: VinFast Showroom München / Facebook
The recently released financial results may explain the change in the company's plans. Although VinFast managed to almost triple its electric car sales last year to around 97,400 units, most of them were sold in Asia. The company also remains unprofitable: on revenue of about $1.8 billion, the net loss was about $3.18 billion.
Source: Elektroauto-news
