Business analysis report vf34

lOMoARcPSD|17343589 BUSINESS ANALYSIS REPORT Lecturer: Dr Hauser Mirjam Student: Phan Nguyen Thuy Duong Student ID: 31211021968 Class: PMk – DH47ISB - lOMoARcPSD|17343589 TABLE OF CONTENTS INTRODUCTION AND BACKGROUND Introduction Background Challenges SITUATION ANALYSIS .4 SWOT Analysis Competitor analysis, Macro-environment and Micro-environment .5 Competitor analysis Macro environment Micro environment SUMMARY, SUGGESTIONS, LIMITATIONS 10 Summary 10 Suggestions 10 Limitations 10 REFERENCES 12 APPENDIX .14 PAGE lOMoARcPSD|17343589 INTRODUCTION AND BACKGROUND Introduction The report is about the marketing strategy, environment and current issues in Vinfast – a Vietnamese car manufacturer, especially focusing on its latest electric car Vinfast VFe34 Firstly, there is brief information about the brand and the electric car as well as potential challenges Then, the report will analyze the Macro and Micro environment, SWOT analysis of the product Finally, suggestions will be given to solve the problems Background Vinfast Manufacturing and Trading Company Limited is an LLC private start-up manufacturer in automotive field It was established in June, 2017 as a subsidiary of the parent organization Vingroup – the largest conglomerate in Vietnam Its headquarter locates in Hai Phong City, Vietnam Vinfast VFe34 is the first Vietnamese smart electric car, which was officially launched on October 15, 2021 at price of around 690 million VND The car is integrated with many smart features Challenges - Competitive pressure: The current Vietnamese automobile market is led by Thaco, Toyota and other reputable brands They have a large quantity of loyalty and customers - Brand barriers: As a young and new brand in Vietnam, customers will hesitate to choose it instead of other imported cars with affirmation in the market PAGE lOMoARcPSD|17343589 - Limitations on automotive auxiliary industry in Vietnam: The domestic supporting industry has not developed Only few components produced in Vietnam, lack of investment and engineers have resulted in less plentiful types PAGE lOMoARcPSD|17343589 SITUATION ANALYSIS SWOT analysis a) Strength - First Vietnamese electric car: It appeals to patriotic customers with label “Made in Vietnam” car - Longest warranty: VFe34 offers 10 years - the longest term in comparison with all cars available in Vietnam - Protect the environment: Those who have high awareness of the surroundings will consider to buy VFe34 - Apply artificial intelligence: This system will provide drivers with smart assistance and security functions to maximize convenience in every journey - Low maintenance cost: The cost is lower than petrol gas and makes it a good choice for people with median income (Appendix a) b) Weakness - Not yet a popular car brand: Vinfast is considered as a young brand and still struggling with gaining brand awareness - Short travel distance: VFe34 can only travel a short distance of 285km per charge It’s just suitable for those travelling within the city - More charging time: It requires longer time to charge than petrol cars - Incomplete infrastructure: Vinfast needs to spend a massive amount of time and money investing on charging stations The planned number of charging stations is much fewer than of traditional ones PAGE lOMoARcPSD|17343589 c) Opportunity - Potential market in Vietnam: There is an increase in need to own a car, which gradually matches with that of ASEAN More people are seriously concern about the environment so they want an ecofriendly car (Appendix b) - Positive perception: Vinfast has received support from many national customers, especially from the government to prioritize domestic products - Many strategic partnerships: Vinfast has set up tight relationships with international firms to create the most valuable and distinctive product before launching in the market d) Threat - Competitive disadvantage: In comparison with the other brands, Vinfast has little experience in automobile industry In 2020, Thaco and Toyota are top car brands in market share of Vietnam (Appendix c) - Decline in demand: During Covid-19 pandemic, the demand to own a private car has dropped significantly because of lock down or working from home - Limitations on automotive industry: The localization in the industry is low and Vinfast has relied on international production of components Competitor analysis, Micro-environment and Macro-environment a) Competitor analysis In the SUV segment, Vinfast VFe34 will compete with many other electric cars in Vietnam: Kia Seltos, Hyundai Kona, MG ZS PAGE lOMoARcPSD|17343589  Kia Seltos: The best-selling car with a modern and youthful appearance at a reasonable price ranging from 699 to 719 million VND  Hyundai Kona: What makes it special is luxurious and high-class interior It has everything expected in a modern car with a favorable price from 636 to 750 million VND  MG ZS: Despite being a new car joining the SUV segment in Vietnam, it has attracted a lot of customers with the cheapest price from 519 to 619 million VND b) Macro environment Political In general, Vietnam has undergone stable politics so the car industry is not negatively influenced by political activities The government has passed lockdown the policy in which import tax on some materials will be reduced to 0%; therefore, essential components of Vinfast cars can easily and economically be delivered to the factory In addition, there are tax incentives to encourage manufacture and consumption of electric cars  Economic Smart car Vietnam gross domestic product in 2020 was about 271.2 billion USD and increased by 2.9%, which is recognized as leading performance in GDP growth of major Asian economies Inflation rate is maintained low at 3.22% in 2020 to raise consumption and demand, encourage production and investment (Appendix d)  Social PAGE lOMoARcPSD|17343589 The population of Vietnam in 2020 was 97.34 million people, becoming the 15 th populous country in the world The total number of households in Vietnam is above 26 million households with 3.6 members in each on average With high population density, Vietnam has witnessed a substantial rise in demand for car ownership (Appendix e)  Technological Vietnam has experienced a rapid development stage of technology in various fields, including automobiles In the current economic globalization with industry 4.0, many cars are well-equipped with advanced technology It is predicted that in the next few years, there will be a new generation of smart cars with superior autonomous drive assistance technology  Environmental The climate condition in Vietnam is tropical monsoon, hot, humid and rainy It has differentiated the automobile industry from other countries Besides, environment pollution is at an alarming rate Many vehicles release a huge amount of toxic gas into the air As a result, many car brands tend to innovate green transportation  Legal According to Minister of Industry, automobile plants must have a study report proved following current national regulations and have a capacity of 10,000 vehicles annually It is required to have registration documents for technical safety and environmental protection in manufacture and assembly Moreover, Vinfast cars have to undergo rigorous examination and assessment from world PAGE lOMoARcPSD|17343589 organizations such as ASEAN NCAP, EURO NCAP, WTLP… before being launched in the market c) Micro environment The company Human resource of Vinfast are those who are experienced and professional executives It has a stable financial condition with support from the parent company Vingroup (Appendix f)  Suppliers Vinfast has established close relationships with many global corporations to be able to manufacture the products in time to meet the demand  Schuler AG – stamping line  Eisenmann – technology, assembly lines  Durr AG – supply of paint lines  LG Chem - a member of LG Group - manufacturing and supplying international standard batteries  BMW - a famous German engine manufacturer - VinFast bought the intellectual property rights from it  An Phat - a leading plastic corporation in Southeast Asia - specializing in the export of thin film packaging Marketing mediaries PAGE lOMoARcPSD|17343589 Vinfast currently has a wide network of 242 distributors and 83 dealers in all provinces, cities in Vietnam They are located at convenient places for customers to easily access and experience the products The company also works with wellknown influencers such as David Beckham, Miss Tieu Vy and other Vietnamese stars  Customers Vinfast has potential customers who are using Vingroup services such as real estate, tourism, medical examination or education They take pride in national brands and are dynamic technophiles wanting to experience Vietnamese electric car However, some customers tend to wait until the quality of the product is verified by the previous users before making a passesdecision  Competitors Vinfast VFe34 is facing numerous potential international competitors in the market Generally, Kia, Hyundai, Toyota are all strong competitors of VFe34 In addition, there is an increase in advanced application in many new cars to compete with Vinfast electric car  Publics Vinfast’s environment includes types of publics: Internal publics and General public About Internal publics, the employees satisfy with the company policies of suitable working hours, desirable working conditions and other attractive benefits Regarding General public, Vinfast has built a positive brand image as a pioneer in Vietnamese automobile industry carrying the mission “to create a better life for people” PAGE Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 SUMMARY, SUGGESTIONS, LIMITATIONS Summary Vinfast and VFe34 have become more and more popular in Vietnam Despite having advantages as a domestic product with a smart system and environmental friendliness, VFe34 is encountering both internal and external challenges Some actions will be necessary to solve these issues Suggestions - Focus on quality to create unique products: The customers are concerned about the quality when evaluating alternatives so core value in every product will help them realize that it is the best choice The brand can add more features and services to make it more convenient as well as maintaining the low price to become highly competitive in the market - Take advantage of human and financial resources: Vinfast should encourage workers to support the car industry with new and useful inventions, ideas and methods to reduce dependence on international components for production - Create a brand impression: Recently, both Vinfast and VFe34 have attracted a lot of attention from customers To make use of this period, Vinfast should find effective ways to promote products to quickly take a remarkable position in the market PAGE 10 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 Limitations The report still carries a limitation is not having sufficient information The reason is Vinfast VFe34 has been just launched for month and none of the customers have a chance to experience the car Therefore, it will lack information and news about the real experience of this product However, in the future, this limitation can be overcome when the cars are reached customers and detailed reviews will be given PAGE 11 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 REFERENCES nhược điểm CUA xe điện can khắắc phục để thuyếắt phục nhiếều người mua xe hon - (2021, April 22) Otosaigon - diếễn đàn, cộng đồềng tồ sồắ Việt Nam https://www.otosaigon.com/threads/6-nhuoc-diem-cua-xedien-can-duoc-khac-phuc-de-thuyet-phuc-nhieu-nguoi-mua-xehon.9009279/ Climate in Vietnam: Everything you need to know - LIOS (2021, May 13) Live and Invest Overseas https://www.liveandinvestoverseas.com/countryhub/vietnam/climate-in-vietnam/ Danviet.vn (2021, October 19) Đâu la loạt đồắi thủ CUA VinFast VF e34, Lieu xe điện Co gi hon để cạnh tranh? danviet.vn https://danviet.vn/daula-loat-doi-thu-cua-vinfast-vf-e34-lieu-xe-dien-co-gi-hon-de-canh-tranh20211018152403805.htm Danviet.vn (2021, October 19) Đâu la loạt đồắi thủ CUA VinFast VF e34, Lieu xe điện Co gi hon để cạnh tranh? danviet.vn https://danviet.vn/daula-loat-doi-thu-cua-vinfast-vf-e34-lieu-xe-dien-co-gi-hon-de-canh-tranh20211018152403805.htm Hồng, T (2020, December 25) Những sách TAC động đếắn thị Truong o to Viet Nam Nam 2020 Báo Thanh Niến https://thanhnien.vn/nhung-chinh-sach-tac-dong-den-thi-truong-o-to-vietnam-nam-2020-post1272792.html PAGE 12 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 Nguyếễn, H C (2018, October 4) Chuyến gia Viet Nam: Xe VinFast se gap phải Su cạnh tranh rat Lon Báo Thanh Niến https://thanhnien.vn/chuyengia-viet-nam-xe-vinfast-se-gap-phai-su-canh-tranh-rat-lonpost1267937.html Review moi Truong làm việc CUA Vingroup - NOI Co Phu hop với ban? (2021, June 22) JobsGO Blog https://jobsgo.vn/blog/moi-truong-lam-vieccua-vingroup/ Thach thức VA Co hoi CUA xe Vinfast Tai Viet Nam (2021, March 12) MUAXEGIATOT https://muaxegiatot.vn/thach-thuc-va-co-hoi-cua-xevinfast-tai-viet-nam.html Thach thức VA Co hoi CUA xe Vinfast Tai Viet Nam (2021, March 12) muaxegiatot.vn https://muaxegiatot.vn/thach-thuc-va-co-hoi-cua-xevinfast-tai-viet-nam.html#mucluc-thach-thuc-nao-dang-hien-huu 10 Thong CAO Bao CHI Ket qua Tong điếều tra Dan so VA nhà o Nam 2019 (n.d.) General Statistics Office of Vietnam https://www.gso.gov.vn/sukien/2019/12/thong-cao-bao-chi-ket-qua-tong-dieu-tra-dan-so-va-nha-onam-2019/ 11 Thực Trang moi Truong Nay – Nguyen Nhan VA giải pháp (2019, August 24) Thồng câều cồắng nghẹt Thịnh Phát https://thongcongnghethuthamcau.com/thuc-trang-moi-truong-hiennay/#14_O_nhiem_moi_truong_khong_khi 12 Vietnam, B (n.d.) đồắi TAC CUA Vinfast thực Su la AI? Brands Vietnam https://www.brandsvietnam.com/13652-7-doi-tac-cua-Vinfastthuc-su-la-nhung-ai 13 VinFast site (n.d.) VinFast - Mãnh liệt tinh thâền Việt https://vinfastauto.com/vn_vi PAGE 13 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 14 Đâu la đồắi thủ CUA VinFast VF e34 Tai Viet Nam? (2021, 3) oto.com.vn https://oto.com.vn/xe-moi/doi-thu-cua-vinfast-vf-e34-tai-vietnam-articleid-upjbwc5 APPENDIX a) Strength - Low maintenance cost b) Opportunity – Potential market in Vietnam PAGE 14 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 Vietnamese need to own a car from 2013 – 2017 c) Threat - Competitive disadvantage Market share of leading automobile manufacturers in Vietnam in 2020 PAGE 15 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 d) Macro environment – Economic GDP of Vietnam in 2020 Vietnam’s GDP growth in 2020 PAGE 16 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 Vietnam’s inflation rate in 2020 e) Macro environment – Social Population of Vietnam in 2020 PAGE 17 Downloaded by v? ngoc (vuchinhhp10@gmail.com) lOMoARcPSD|17343589 Vietnam is the 15th most populous country f) Micro environment – The company PAGE 18 Downloaded by v? ngoc (vuchinhhp10@gmail.com)