groupassignment mkt101 vinfast llc

INTRODUCTION ABOUT VINFAST Vingroup:- Vingroup Group - Joint Stock Company referred to as "Vingroup Group",formerly Technocom Group, was established in Ukraine in 1993 by youngVietnamese

TRƯỜNG ĐẠI HỌC FPT - -

Hà N i, 13/03/2022 ộ -

TABLE CONTENT

- Company background

- Description of product/service offerings

- Profile of target customer and target market

II Analysis of the company's microenvironment and macroenvironment………5 III Analyze the results of the market research……… 15

INTRODUCTION ABOUT VINFAST

Vingroup:

- Vingroup Group - Joint Stock Company (referred to as "Vingroup Group"),formerly Technocom Group, was established in Ukraine in 1993 by youngVietnamese people, initially operating in the food and beverage industry greatsuccess with the brand Mivina In the early years of the 21st century, Technocomwas always present in the ranking of Top 100 largest enterprises in Ukraine In

2000, Technocom - Vingroup returned to Vietnam to invest with the desire tocontribute to the construction of the country

- With a long-term vision and a view of sustainable development, Vingroup hasfocused on investing in tourism and real estate with two initial strategic brands,Vinpearl and Vincom With continuous efforts, Vincom has become one of the No

1 brands in Vietnam in real estate with a series of complexes of commercial centers(commercial centers) - offices - apartments in big cities, leading the trend of smarturban - eco-luxury in Vietnam In January 2012, Vinpearl Joint Stock Companymerged into Vincom Joint Stock Company and officially operated under the Groupmodel with the name Vingroup Group - Joint Stock Company In the spirit ofsustainable and professional development, after its establishment, Vingroup hasrestructured and focused on developing with many brand groups such as:Vinhomes (A system of high class serviced apartments and villas); Vincom(System of commercial centers, level); Vinpearl (Hotel, tourism); Vinpearl Land(Vin entertainment (Health); Vinschool (Education); Vincharm (Beauty care);VinFast (cars and electric motorcycles)

- With these achievements, Vingroup is being evaluated as one of the powerfulprivate economic groups, with a sustainable and dynamic development strategy,with the potential for international integration to rise to the regional level and theworld

Vinfast:

- VinFast (or VinFast LLC), the full name is Product Limited Liability CompanyVinFast Manufacturing and Trading, is an established Vietnamese automobilemanufacturer in 2017 The company is a member of Vingroup construction and realestate group and was founded by Pham Nhat Vuong The company name stands forthe phrase "Vietnam - Style - Safety - Creativity - Pioneering" (the letter Phchanged to F) - VinFast is a project in the field of automobile and motorbikemanufacturing - one of the leading industries, having an impact on many otherindustries that Vingroup has only joined for more than a year With the aspiration

to become the leading car manufacturer in Southeast Asia, Vingroup has invested a

lot in this project By the end of the third quarter of 2018, this group had pouredmore than 13,600 billion VND into VinFast, an increase of more than 12,900billion VND (equivalent to about 580 million USD) compared to 685 billion VND

at the beginning of the year VinFast car and electric motorcycle production projectincludes 5 specialized areas located in Lach Huyen, Cat Hai, Hai Phong, expected

to have a total investment of up to 4.2 billion USD VinFast factory complex hasinvested and put into use the most advanced production technologies such as:stamping workshop according to industry 4.0 standards, body workshop with morethan 1,000 robots, 100% automatic spot welding line, a paint shop with state-of-the-art technology and 79 applied robots, an assembly workshop with fullyautomated moving processes and state-of-the-art testing equipment

- To accelerate market entry, VinFast has relied on partnerships with variousforeign companies in terms of design, production equipment and components Toachieve a localization rate of 60%, VinFast has also cooperated with internationalsuppliers to establish component factories in the complex in Hai Phong In June

2018, VinFast signed a Memorandum of Understanding to establish a joint venturewith Aapico Hitech Plc., one of Thailand's leading auto parts manufacturers, tobuild a body shop in Thailand complex to supply VinFast products VinFast alsoplanned to have eight auto parts factories set up, including four factories invested

by VinFast, two joint ventures between VinFast and suppliers, and two factorieswholly owned by VinFast supplier At the same time, the company also acquired

GM Vietnam, including a factory in Hanoi, dealer network and staff VinFast'sFadil model is manufactured under license from GM

- VinFast seems to have a vision for the future In the initial phase, the companywill develop cars using internal combustion engines, but it also plans to catch upwith industry trends by developing battery electric vehicles through its partnershipwith EDAG company Engineering of Germany VinFast's mission is to become theleading automobile manufacturer in Southeast Asia and build a world-classVietnamese brand, thus creating a new hope for the Vietnamese VinFast President,

Ms Le Thi Thu Thuy, has affirmed that the company wants to target a luxury brandand will also expand exports to foreign countries Thus, not only is VinFastdetermined to fulfill its goal of producing cars in the Vietnamese market, butVinFast is also making great strides to realize its ambition to export Vietnamesecars abroad

MICROENVIRONMENT OF VINFAST

1 The company:

- VinFast company is a member of Vingroup founded by Mr.Pham Nhat Vuong,managing director by Mr James Benjamin DeLuca and Le Thanh Hai and severalother leaders In terms of infrastructure, our research, VinFast has a mainproduction and assembly plant located in Hai Phong City The factory covers anarea of 335 hectares with a total investment of 3.5 billion USD and is one of thelargest industrial projects in Vietnam The company cooperates in technology,engineering, strategic consulting support, human resource training with the largestglobal manufacturers of automobiles, spare parts and heavy industrial equipmentsuch as BMW, Siemens AG, ThyssenKrupp, etc

2 Customer:

- Vinfast’s internal customers: the people who work in the business providingproducts and services in customer service departments The company’s employeesare the most loyal customers and they can easily advertise Vinfast’s products Theenterprise needs to build a good customer awareness in order to create an effectivedistribution system to each customer group to support that segment to buy a careasily

- Vinfast’s external customers, however, are those who have the need to use electricbikes and cars, without income hierarchy They can also be Vinfast's employees,since they know how to advertise their products in the most effective way ForVinfast, from the customer’s perspective, they were interested in:

+) The increase in customer demand: Nowadays the residents of Hanoi andHoChiMinh city tend to use “clean” vehicle, which is why Vinfast has seized theopportunity to produce a lightweight and environmentally friendly electricmotorbike called Klara, with lead-acid and lithium-ion battery version

+) After-sale service: Vinfast offers a gift package worth 15 million VND tocustomers who have received a Fedil car through the event “Top notch experiencewith Vinfast’s Fadil” Moreover, those who have purchased life insurance inadvance will receive 7 million VND in cash There is also a program called

“Exchange old for new”, applicable to all car owners who want to change toVinfast

+) Reasonable price for market segments: VinFast continues to introduce SUVsand

Sedan series In the domestic market, this brand officially accepts deposits from customers with a commitment of "three nos": no depreciation, no financial costs

and no interest included in the price The price of 1 product is 336 million VND, cheaper than previous car manufacturers in the same segment with the price of more than 400 million VND.

+) Quality is the top priority: According to VinFast, the company's models will

be having hundreds of tests for quality and safety standards in 14 countries before mass producing

3.1 General competitors:

- According to the plan, VinFast will launch Premium cars series - abbreviated asPre in 2020, spanning all segments A, B, C and D, from small cars, sport utilityvehicles to family cars Combining 3 introduced car lines has brought the totalnumber of VinFast cars to 7 Thus, in the future, VinFast will have to compete withmany rivals in the industry

- In the class A urban car segment (also known as the low-cost car segment),VinFast already has a key product, the Fadil model (listed for VND 423 million).VinFast Fadil's competitors will be two Korean car models assembled in Vietnam,namely Hyundai Grand i10 and KIA Morning, in which Hyundai Grand i10 is thesecond-best-selling car model in the market and leading the A-class car segment

- VinFast also has 1 car model in the D-class car segment, which is the LUX A20model (listed for 1,366 billion VND) During this period, the rival of LUX A2.0 is

no other than two prominent names, Toyota Camry and Mazda6

- In the SUV segment (large utility vehicle), VinFast has the LUX SA2.0 model(listed for 1,818 billion VND) that is causing a fever in the market This segment isstrongly developed recently and car manufacturers are also racing to launch newproducts VinFastSA2.0's strongest competitor is Toyota Fortuner (1,026 - 1,354billion VND) In addition, on the market there are also Honda CR-V, FordEverest/Explorer, Nissan X-Trail, Hyundai Santa FE, Mazda CX9 Most largeSUVs are imported cars

- In Vietnam, the electric motorcycle market is divided into two segments,domestic and imported, of which most of them come from China About 10 yearsago, Chinese electric motorbikes began to be imported into our country and wereaccepted by Vietnamese people because of their low prices, no need to fill up gasand no driver's license However, over time, the disadvantages of these modelswere gradually revealed after about 2 years of use The appearance of Klaraelectric motorbikes diversified the choice of locally assembled electric vehicles inthe market, compared to the previous dominance of imported Chinese cars.However VinFast was not the only company to see the potential of the electricmotorbike market in Vietnam Right after VinFast, a number of foreign electricmotorcycle companies also entered Vietnam with the desire to dominate the marketshare when there were few competitors In September 2019, Korean electric

motorcycle company MBL officially entered the Vietnamese market This brandlaunched 3 different versions: Mbi X, Mbi S and Mbi V with prices ranging from39.8 - 59 million VND which is a lot higher than VinFast Klara According tocustomers’ feedback, MBI not only has an eye-catching design and differentfunctions but also very good quality Despite the high price, this still definitely will

be a tough competitor of VinFast Immediately after MBI, in November, another

"big" electric car company entered the Vietnamese market, Yadea The Chineseelectric car company is known for its largest sales in the world It has actually beenpresent in the Vietnamese market for a long time and has expressed its ambitionswhen introducing 3 models from cheap to high-end including Yadea E3, Ulike andG5, listed from 16 - 40 million VND with the hope of competing with VinFastKlara in the same segment

3.2 Potential competitors:

- In Vietnam, it is difficult for any enterprise with great potential like Vingroup to

be able to establish its own car and motorbike brand like VinFast, therefore theirpotential competitors are foreign enterprises with many competitive advantages AsVinFast is becoming more and more popular in Vietnam, a series of big brands arealso planning to occupy the available potential market

a) Potential competitors of VinFast’s cars:

Currently, electric and hybrid car models have not been imported much andare not so popular in Vietnam However, due to the fact that environmentallyfriendly vehicles are becoming a global standard in the coming years, the eco cartrend including electric and hybrid vehicles is taken seriously in the industryglobally:

- Ford, Daimler, BMW, GM and many other companies have committed to investabout $225 billion in electric vehicles over the next five years Volkswagen led therace with $44 billion, with the ambition to end the development of gasoline anddiesel models by 2026 and 40% of sales are electric cars by 2030 Ford on theother hand, out of a total of 11 billion USD spent on electric vehicles, invests 500million USD in electric car start-up Rivivan The company has just introduced theMustang Mach-E SUV and the upcoming F-150 all-electric pickup Meanwhile,General and LG (Korea) technology company formed an alliance to produceelectric batteries with a cooperation agreement of 2.3 billion USD

- Tesla, an American electric car company, is a formidable competitor in terms ofadvanced technology and eye-catching exterior In the near future, when Tesla isimported to Vietnam more frequently, this will be a strong competitor of Vinfast

- Lightyear recently launched the world's first solar-powered electric car prototype

- the Lightyear One The model went on sale in Europe in 2021 and listed from

149,000 Euro (about 170,000 USD) Lightyear also said that they have producedmore than 100 Lightyear One units and are expected to be mass produced in thefuture This product can totally compete directly with VinFast cars if imported intoour country.

b) Potential competitors of Vinfast’s electronic motorbike:

- Recently, at the Indonesia International Motor Show 2019, Indonesia's firstelectric motorcycle model called Gesits was officially launched Gesits was under

PT Gesits Technologies Indo’s (GTI) research and development in a manufacturingplant in Cileungsi, Bogor, West Java Harun Sjech - GT’s CEO, said: “The Gesitsmodel made in Indonesia has a localization rate of up to 89% The operating cost

of this electric scooter model is 70% lower than that of scooter models usinggasoline engines The front of the car has a design that is quite similar to theVietnamese HondaAir Blade model In Indonesia, Gesits will be distributed tocustomers from June 2019 with the price from 1,640 USD, equivalent to 38.2million VND PT Gesits Technologies Indo (GTI) aims to produce 50,000 Gesitsvehicles per year and in the first years, Gesits will be sold in Indonesia thenproceed to focus on export to other markets With this plan, Gesits might become adirect competitor to VinFast’s Klara in the electric motorcycle segment whenentering the international market

4 Distributors:

- Vinfast's distribution system is not inferior compared to other competitors By theend of 2019, VinFast had more than 40 dealer addresses 18, 2S and 3S put intooperation After less than 1 year, VinFast's dealer system has reached the number of

76 VinFast auto dealers and with such a number of dealer addresses, VinFast willeven have a wider distribution channel than Hyundai Thanh Cong (70 dealers) orToyota Motor Vietnam (56 dealers)

- Instead of setting up a distribution system from scratch, VinFast acquiredChevrolet's entire car distribution system in Vietnam Immediately, Vinfast had arelatively wide distribution system that took many years to form and they alsochose the form of distribution as wholesale, a 1-level distribution channel (Vinfast-> Distributors -> Car buyers) Vinfast has set out criteria for selection anddistributor support policy From there, they invited units and individuals who aredistributing other car models such as Ford, Honda, Mazda, Kia, Suzuki toparticipate in the distribution of Vinfast cars According to our research onVinfast's official website, this car company has more than 244showrooms/distributors across the country

5 Suppliers:

- Nowadays, VinFast is cooperating with many famous suppliers in the automobileand motorcycle manufacturing and trading industry: Bosch - the world's largestsupplier of automotive technology and components, applying world most advancedtechnologies in manufacturing; Schuler AG – stamping line; Eisenmann –technology, assembly lines; Durr AG - paint supply line; LG Chem, a member of

LG Group - manufacturing and supplying international standard batteries Inaddition, VinFast also bought the intellectual rights of BMW - a famous Germanmanufacturer in the field of mechanical engineering In 2019, in order to bring thevehicle localization rate to 60%, VinFast has cooperated with a domestic supplier,

An Phat - the leading plastic corporation in Southeast Asia, specializing inexporting thin film envelopes Recently, An Phat has participated in the auto-motorcycle auxiliary industry, through the acquisition of the Hanoi Plastics factorywith big customers such as Toyota, Honda, Piaggio After the foundation of VinFast - An Phat joint venture (VAPA), 100% of VAPA's products will beimmediately supplied to VinFast's factory As a result, the localization rate of eachVinFast car and motorbike will be increased, helping to increase Vietnamesecustomers' awareness of Vietnamese cars

MACROENVIRONMENT OF VINFAST

1 Economic:

- In recent years, Vietnam has had a stable and remarkable growth rate The yearthat Vinfast was first established - 2017 was considered a miracle year forVietnam's economy The economic growth rate reached 6, 81%, exceeding thetarget by 6.7% In the second half of the year, there was a spectacular breakthrough

of over 7% (7.46% in the third quarter, 7.65%) in the fourth quarter, creating ahuge boost for the economy of our country This is also a record number for thepast 10 years In the following years, the economic growth rate remainsimpressive, reaching 7.08% in 2018 and 7.02% in 2019 The year 2020 isconsidered a year of great difficulties and challenges for the economy the world ingeneral, including Vietnam The world economy is forecasted to have the mostsevere recession in history, with the growth of major economies all falling deeplydue to the negative impact of the Covid-19 epidemic However, Vietnam'seconomy still maintains growth with an estimated GDP growth rate of 2.91%

- The Covid-19 epidemic has unpredictable developments, disrupting economic activities of countries around the world and The US-China trade conflictremains intense In the country, natural disasters and epidemics have a significantimpact on the activities of the economy and people's lives; unemployment rates arehigh However, with drastic and effective solutions in executing the dual goal ofboth disease prevention and socio-economic development, Vietnam's economy stillachieved positive results Although GDP growth in 2020 is the lowest in the period

socio-of 2011-2020 due to the negative impacts socio-of the Covid-19 epidemic, it is still asuccess for our country as we are in the group of highest growth rate countries inthe world

- These outstanding economic growth marks have created momentum for thedevelopment of Vinfast with many open opportunities and a solid foundation,especially in scale expansion and investment growth

GDP GROWTH IN 2010-2020

(According to Vietnam’s General Statistic Office)

- Besides, our country also successfully controlled the inflation rate below 4% by

2020 Inflation in 2017 reached the target of 3.5%, in 2018 it was 3.54%.Especially by 2019, inflation was only 2.79%, much lower than the growth rate.Therefore, people's income level is not affected much, so consumption tends toincrease Moreover, low inflation rate also creates a stable macroeconomicenvironment, a favorable business environment for investors, especially foreigninvestment

- Globalization helped expand the market, increasing the competitive advantage forVietnam's exports compared to other countries in the region; thereby, the structure

of exports has tremendous improvements in quality On the other hand, extensiveglobalization helps to reduce the cost of imported input materials, increasing thecompetitiveness of goods in the domestic and international markets and at the sametime reducing the competitive pressure of imported goods

3 Political:

- The political environment includes: the legal system, government agencies andthe role of social pressure groups The developments of these factors strongly anddirectly influence the corporate governance decisions The political environmentshows the basic regulation of business activities, the strengthening of stateagencies and the development of benefit protection groups

- Acknowledging the importance of the auto-motorcycle industry, from thebeginning of 2017, the Government has announced many policies to facilitate andsupport Vietnamese businesses to participate in this industry because that is notonly the future of the automobile industry – it is also a long-term and sustainablevision for the Vietnamese industry On June 4th, 2019, at Dinh Vu industrial park,Cat Hai, Hai Phong, Prime Minister Nguyen Xuan Phuc attended the inaugurationceremony of VinFast car factory with an encouraging speech for young car brand,showing the government's great support for VinFast

- VinFast, similar to other automobile businesses, will be subjected to tax rates asprescribed by law such as corporate income tax, export and import tax, value addedtax (VAT) and special consumption tax However, this is the first Vietnamese carbrand, so it will receive a lot of support from the Government According to ourresearch, all product lines of VinFast, including motorcycles and cars, in the firststage will apply the “3 no”' policy, which is no financial costs, no depreciationcosts and no interest Therefore, in the first stage, there won’t be any financial feesincluding working capital, interest paid on loans to build factories or depreciationcosts Vehicle price will be listed by cost of production and cost of sales

- In addition, in order to reduce environmental pollution and promote thedevelopment of smart eco-friendly car technology, from 2010, the Prime Ministerissued Decision 909/QD-TT approving the "Project on controlling emissions ofvehicles participating in traffic in provinces and cities" Nowadays, domesticenterprises have gradually transformed, replaced and relied on green technology inthe production of motorcycles and mopeds, contributing to the mutual effort ofreducing environmental pollution

=> It can be seen that the Government of Vietnam is extremely supportive in manyaspects for car manufacturers in general and VinFast Group in particular This is ahuge lead for Vinfast in the domestic industry

4 Social and Cultural:

- People living in any society also carry a cultural identity which corresponds tothat society Different cultural identities will form different perspectives on values and norms Through that concept of values and norms, culture has a profound

influence on management decisions If managers understand and are properlyaware of the values and cultural standards, they will make the right managementdecisions, otherwise they will be able to make unfortunate mistakes.

- In Vietnam, there is an imbalance between the number of vehicles on the road andthe traffic technical infrastructure In addition to the lack of synchronization anddeterioration of transport infrastructure, there is a delay in the constructionprogress of key traffic constructions, which significantly affects the dailycirculation of people such as railway Cat Linh - Ha Dong urban area in Hanoi (inabout a year ago)

- The current means of public passenger transport is mainly buses, which only meet8% of people's travel needs When the public transport system is not reallydeveloped, and there are not many constraints in registering to own a personal car,the number of private means of transport continues to increase rapidly, especiallymotorbikes because of the reasonable price for this type of vehicle In recent years,the market has also witnessed more personal vehicles such as electric bicycles andelectric motorbikes, which are used by a large number of students, giving morepressure to our country's traffic system

- While waiting for solutions to be proposed and implemented to solve the abovesituation, traffic congestion and traffic accidents in our country have reached analarming level High traffic density, many projects under construction,unreasonable traffic arrangements and low traffic awareness of the people are thereasons that make the traffic in cities become more horrible than ever According tothe Hanoi police, there are 381 traffic complex locations in the city, which are athigh risk of leading to congestion, especially during peak hours The phenomenon

of people violating the traffic law is still common, such as drinking while driving,running red lights, crossing lanes, going in the opposite direction, stopping andparking illegally

5 Natural:

- Natural factors in Vietnam are exploited by VinFast such as terrain, rain, land,climate, weather, etc Besides that, the climate change is increase, which becomes aproblem for the car industry

- According to the Tuoi Tre newspaper, VinFast has produced 15.000 Klara electricmotorcycles that consumers can move freely and still reduce emissions into the air

In addition, they also have environmental protection campaigns such as ‘Vi tuonglai xanh’, ’15.000 nguoi chung tay cung VinFast giam o nhiem moi truong’, etc.VinFast has policies to help businesses create products that are not only quality butalso adaptable to natural conditions This inspires their customers, especially youngpeople to be environmentally conscious and also contributes to raising their brand