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Vietnam’s biggest industrial conglomerate quits smartphones and TV biz, bets on electric cars
No breakthroughs left to make in electronics, says CEO as company eyes off IPO-by-SPAC
Vietnam's largest industry conglomerate, Vingroup, has announced it will no longer develop televisions and smartphones under its VinSmart brand and instead redirect resources toward its electric vehicle unit, VinFast.
“This is a strategic step to bring VinFast towards its goal of becoming one of the smartest and most convenient electric car manufacturers in the world,” said Vingroup in a canned statement.
The Vietnamese conglomerate said it won't trash its electronics division, will honor warranties, support products and keep its VinSmart factories operational until existing consumer electronics product life cycles end. At that point, they will outsource some of the factory to partners and shift other facilities to new products.
The firm will also maintain research and development in electronics components like batteries and electric motors as well as Smart City and IoT devices.
In its three years of existence, VinSmart has introduced 19 phone and five TV models, without much success. The company's phones cracked the top three for market share in Vietnam, but didn't make much of a dent elsewhere.
In 2020 the company had a go at smartphone exports to the US, predicting two million sales a year.
According to VinGroup’s vice president and general director, Nguyen Viet Quang, the change is to “bring many benefits and outstanding experiences to humanity” as smart phones and TVs no longer provide "breakthrough capabilities.”
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The move comes as Samsung continues to dominate the global smartphone market, thanks in part to factories in Vietnam.
According to Reuters, VinFast was the fifth most popular car purchased in Vietnam in 2020, falling behind Hyundai, Toyota, Kia and Mazda but beating out Mitsubishi, Ford and Honda. VinFast's CEO Nguyen Thi Van Anh told Reuters it wanted to compete with Tesla and the division would launch in North America and Europe in 2022.
Numerous reports have said VinGroup is seeking to IPO, which could raise about US$2bn. The company has said it is considering the use of a Special Purpose Acquisition Company (SPAC) to complete the deal, on trend with companies like Singaporean ride-sharing giant Grab, which availed itself of the almost-back-door listing in April 2021. ®