Shares of Vietnamese electric vehicle maker VinFast began trading on the Nasdaq on Tuesday, following completion of its merger with the U.S.-listed special purpose acquisition company Black Spade Acquisition.
VinFast’s new U.S. shares opened at $22 and briefly jumped before declining. The stock was down about 9% as of mid-morning on Tuesday. Black Spade Acquisition’s shares closed at $10.45 on Monday.
SPACs are shell companies that raise capital in an IPO and use the cash to merge with a private company in order to take it public, usually within two years.
The deal with Black Spade valued VinFast at approximately $23 billion, according to a June filing with the U.S. Securities and Exchange Commission.
“It’s a big milestone for us to be listed in the U.S. The listing is going to open access to the capital markets for us in the future,” VinFast CEO Lê Thị Thu Thủy, who uses the name Madame Thủy in English, told CNBC’s “Squawk Box Asia” earlier Tuesday morning.
VinFast, the automobile arm of Vietnamese conglomerate Vingroup, was founded in 2017. It has so far imported about 2,100 of its EVs to the U.S. from Vietnam, and brought nearly 800 more to Canada.
The company made its first U.S. deliveries in March, but it still has a long way to go to compete with giants like Tesla and the Detroit automakers.
We try to stay competitive in every market that we are in in terms of profitability. I think it will come together with the volume. For now, we will stay true to our strategy.Lê Thị Thu ThủyCEO of VinFast
On whether VinFast is under the pressure to cut prices in general, following a series of price reductions by Tesla and other EV rivals earlier this year, Le said the company’s strategy is “offering premium quality products at affordable pricing with excellent after sales service.”
“We always price our products quite competitively compared to other similar products. But when you look deeply into our products, we are loaded with more features and more technology. So I think consumers started recognizing the values that we bring with our products,” said Lê.
“We try to stay competitive in every market that we are in in terms of profitability. I think it will come together with the volume. For now, we will stay true to our strategy.”
Tesla passenger vehicles are eligible for a $7,500 federal tax credit in the U.S., while VinFast vehicles don’t currently qualify for the tax savings as they’re not built in the U.S.
To compete with brands in the U.S. market, VinFast is building a factory in North Carolina. The automaker said the 1,800-acre facility is designed to produce up to 150,000 vehicles a year in the first phase.
“With the North Carolina plant, we expect that we’d be able to significantly reduce the costs and [offer] the products at affordable pricing to the customers in the U.S.,” Le said Tuesday.