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The Vietnamese electric vehicle manufacturer VinFast Auto Ltd (NASDAQ:VFS) is reportedly seeking a bank loan of approximately $250 million to finance the construction of its new assembly plant in Subang, Indonesia.
The company, a subsidiary of Vingroup JSC and controlled by Vietnam’s wealthiest individual, Pham Nhat Vuong, has approached banks in Indonesia for a loan denominated either in U.S. dollars or the local currency, reported Bloomberg.
These discussions highlight VinFast’s ambitions to expand its regional footprint and compete in the increasingly competitive global EV market.
The sector has faced intense competition, with significant price cuts impacting earnings. VinFast, which launched its first model five years ago, continues to receive backing from Vuong, who has committed to support the company until he exhausts his funds.
Also Read: Emerging Tesla Challenger VinFast Forges Ahead With Asia Expansion Despite Global EV Slowdown
VinFast’s expansion into Indonesia is part of its broader strategy to grow its presence in Southeast Asia and to become a significant player in the global EV market, which has seen rapid growth and increased competition.
While VinFast has not confirmed the specifics of the loan, a spokesperson mentioned that the company is considering various capital acquisition opportunities.
The potential $250 million loan would significantly bolster VinFast’s ability to establish and operate its new assembly facility in Indonesia.
The startup said it sees a 30x to 40x increase in sales in the U.S. market this year, over $6.4 million in 2023.
Price Action: VFS shares are trading higher by 0.41% at $4.197 at last check Wednesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image via Shutterstock
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