VinFast stock surges on first trading day, valuing NC-bound carmaker above Ford, GM

VinFast shares surged on its stock market debut Tuesday, as the North Carolina-bound electric vehicle maker ended the day worth more than Ford or General Motors.

The Vietnamese company entered its first day on the NASDAQ exchange with a share price of $22. Volatile trading sent the stock up and down throughout the morning, but by market close, its share price was $37.06. This valued the 6-year-old startup, which has been recording steep losses, at almost $86 billion. For comparison, the market capitalizations of Ford and GM are $48 billion and $46 billion respectively.

VinFast stock receded Wednesday morning, but as of midday, the company was still valued at around $68 billion, exceeding the combined worth of rival public electric car manufacturers Rivian, Lucid and Nikola.

The automaker is trading under the ticker VFS. It went public by merging with a special purpose acquisition company, or SPAC, called Black Spade, through an agreement that valued VinFast at $23 billion or $10 a share.

The company is arriving on the market as it tries to break through the crowded field for electric vehicles. As of June 30, VinFast says it has delivered close to 19,000 electric SUVs worldwide. In a release Tuesday, the company said it had a “strong foothold” in Vietnam and 122 stores globally.

As of July 19, a VinFast spokesperson told The News & Observer, there were approximately 350 VinFast vehicles on U.S. roads. At the end of that month, the company ceremonially broke ground on its planned $4 billion car and battery plant in Chatham County, about 30 miles southwest of Raleigh. VinFast has pledged to create 7,500 jobs at the site by 2027.

It will be the company’s first factory outside Vietnam.

Brace for stock volatility

VinFast has sought multiple avenues to help cover its construction costs in North Carolina.

The company has secured incentives from the state and county, private bank financing and additional billions from its owner. VinFast has also applied to the U.S. Department of Energy for a $1.4 billion loan.

While the carmaker did not raise money from its SPAC deal, entering the stock market will broaden its access to investors at a time when it is still recording heavy losses ($1.3 billion in 2021 and $2.1 billion last year).

On Aug. 10, Black Spade shareholders approved the merger, and VinFast assumed the SPAC’s public listing on Tuesday. Tuesday morning, VinFast executives rang the opening bell on the NASDAQ.

But people should not read too much into the immediate fluctuations after a SPAC merger, says New York University law professor Michael Ohlrogge, who studies corporate governance and financial regulation.

“It’s quite common for there to be a spike immediately post-merger,” he said.

Given the high rate of share redemptions by Black Spade shareholders, Ohlrogge cautioned more price swings are likely as buyers and short sellers navigate the startup’s new stock.

VinFast is considered to be a low-float company given that it has made relatively few shares available for trade. This can cause buying and selling runs to heightened price variability.

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