Most observers of the market knew that the rise that Vietnamese electric vehicle stock VinFast Auto (NASDAQ:VFS) was on could not continue. And indeed, not long after the most vocal got out there and said as much, the decline started. Worse for VinFast, it’s still going; it lost over 4% in Friday morning’s trading and on nothing much in the way of news.
One of the biggest reasons for the latest plunge is that very little of VinFast can actually be traded. Roughly 99% of all VinFast shares are currently under the control of its founder, Pham Nhat Vuon. Anyone else inclined to invest has access to only that remaining 1% or so, and that’s made for staggering volatility. While certainly, VinFast has a line of cars to offer and has even been making deliveries, it’s not anything that’s so markedly different from what’s already been seen that it should prompt huge new investment.
In fact, VinFast is also running into some trouble with the Chinese, while it takes aim at breaking into the European market. The Chinese market is hampering VinFast’s efforts to go abroad thanks to a combination of increasingly onerous regulations and rising competition from Chinese electric vehicle makers themselves. Meanwhile, VinFast has launched some showrooms overseas; it only recently opened its third in Germany and is also building on French and Dutch operations.
A look at the last five trading days for VinFast stock shows a familiar story: a waterfall of red ink and it’s all headed downhill. It was slower going at first, but then, a much more pronounced drop hit September 7, followed by a return to a steadier rate of decline.
