Considering how bad our first experience with the VinFast VF8 was, it didn’t seem like the best idea for VinFast to go public. Then again, no one at Jalopnik is an investment expert, so maybe someone smarter was giving better advice we just couldn’t understand. Right out of the gate, it looked like we couldn’t possibly have been more wrong, with the stock price shooting up to $82.35 a share. Today, VinFast’s stock isn’t even trading at $3 a share.
At its peak, the new electric car company was valued at more than $85 billion, making it the fourth most valuable automaker in the world, behind only Tesla, Toyota and BYD. Except, unlike those three companies, VinFast barely sells any cars to actual customers. Vingroup founder Pham Nhat Vuong also retained control of more than 99 percent of VinFast’s stock, leaving only 0.3 percent of total shares for others to trade.
So it’s not like there weren’t signs that VinFast was overvalued. Some investors likely knew that going in and were betting they could make a quick buck by exiting before the crash. And if they got lucky and sold on August 28 at the peak, they probably did. The next day, the stock went into freefall, plunging to $46.25. By September 7, it was down to $17.99 and has only continued to fall. A share of VinFast hasn’t been worth more than $10 since the end of September, and despite recovering slightly, earlier today it hit a record low of $2.57.
As you can imagine, some of the people who thought they were making a legitimate investment are upset by this impossible-to-see-coming development. Earlier this month, two law firms announced a class action lawsuit that claims VinFast “misrepresented and/or failed to disclose that: (i) VinFast lacked sufficient capital to execute its purported growth strategy; (ii) VinFast would be unable to meet its 2023 delivery targets; and (iii) accordingly, VinFast had overstated the strength of its business model and operational capabilities, as well as its post-Merger business and/or financial prospects.”
Speaking to the Charlotte News & Observer, VinFast’s spokesperson called the claims “baseless” and said, “VinFast has adhered to the highest ethical standards and has consistently complied with all laws and regulations in the markets where it operates. We will not comment further on this matter.”