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Despite selling just 24,000 vehicles last year, Vietnam’s VinFast this month became the world’s most valuable automaker, well ahead of multimillion-unit rivals such as Volkswagen, Ford and General Motors.

After the electric car company listed on the U.S. Nasdaq stock exchange through a special purpose acquisition company on Aug. 15, a trading frenzy pushed its market capitalization to a peak of $190 billion. Even with a 50% drop in shares since Monday, VinFast is still in the red and is still valued at $95 billion.

VinFast’s frenzied growth has put the spotlight on its billionaire founder, Pham Nhat Vuong, who was already Vietnam’s richest man before the IPO and controls 99 percent of the company, meaning he is now is worth at least over $60 billion (on paper, at least).

Forgoing a traditional IPO, VinFast went public through a SPAC, a public “blank check” company that has already secured funding from investors. VinFast shares have a free float of less than 1%, which means a small number of shares are publicly traded — which is partly responsible for the wild swings in valuation.

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VinFast founder Pham Nhat Vuong was Vietnam’s richest man before his electric car company went public © Linh Pham/Bloomberg

VinFast is just one part of Vuong’s business empire. He is the founder of Vingroup, a private conglomerate whose fortunes have been closely tied to Vietnam’s economy and its communist government for the past two decades. The national shift will be on display next month when U.S. President Joe Biden visits Vietnam, Asia’s fastest-growing economy, in 2022 in pursuit of closer ties.

Biden will arrive in a country dominated by the Vingroup brand. Vuong started his career in Ukraine in the 1990s, co-founding Mivina, one of Ukraine’s most popular noodle brands. He returned home after earning about $150 million from sales to Swiss food giant Nestlé just as Vietnam’s government accelerated its transition from a centralized to a market economy.

Domestically, Vuong invested in real estate — his first project was a resort called Vinpearl — and went on to develop projects ranging from office buildings and shopping malls to housing projects. He has since expanded into entertainment, retail, healthcare, education and technology with businesses including Vinhomes, Vinschool, VinAI and VinBrain.

“In Vietnam, we’ve seen the rise of politically influential private sector national champions. Vingroup is one such national champion and will receive strong support from the government,” said Peter Mumford, Southeast Asia analyst at Eurasia Group.

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Last year, Vingroup reported revenue of 13.05 VND ($5.4 billion) and an after-tax profit of VND 2. It is the country’s largest private employer with 51,200 employees and has international backers including Singapore’s sovereign wealth fund GIC and South Korean conglomerate SK Group.

Vingroup’s rise has coincided with Vietnam’s rapid growth, attracting dozens of international investors as the country forges its role as an alternative manufacturing hub to China.

Economically there are shadows. Slowing international demand has weighed on economic growth this year, while Vietnam’s exports fell for a sixth straight month in August, the longest streak of declines since 2009. The World Bank this month forecast gross domestic product growth of 4.7% in 2023.

The government’s lending curbs and anti-corruption crackdown aimed at limiting economic risk have hit the real estate and construction sectors in particular, sending prices on international bonds issued by the country’s other big developers sharply lower.

Mohamed Faiz Nagutha, Southeast Asia economist at Bank of America Securities, said structural tailwinds for Vietnam as a foreign direct investment destination remain. “I think we’re through the worst of it in an economic sense . . . but we still have uncertainty in the fight against corruption.”

Vuong’s attempt to build Vingroup into an overseas force — starting with VinFast — comes against a backdrop of tough conditions and economic instability.

The automaker has moved away from making gasoline-powered vehicles to focus on electric vehicles, building a factory in North Carolina and opening showrooms on the U.S. West Coast. The company said it plans to launch the product in Europe as well. “Our ultimate goal is to create an international brand,” he told Bloomberg in a rare interview in 2019.

Vuong has poured his fortune into the automaker, pledging in April to inject $2.5 billion in new capital. “Vingroup and our chairman will always support VinFast,” the carmaker’s chief executive, Le Thi Thu Thuy, told the Financial Times ahead of its listing. “Whatever VinFast needs, Vingroup will support.”

Vuong was not available for an interview.

VinFast, still unprofitable six years later, has had problems with its U.S. debut, including a December recall of 999 cars from its first shipment. The net loss deepened to 14.1 VND in the first quarter, compared to 9.7 VND in the same period last year.

VinFast’s sales are still far below those of its competitors. The company expects to sell 50,000 vehicles this year and says it has an annual production capacity of 300,000 electric vehicles.

VinFast’s listing at least satisfies Vuong’s craving for international attention — though he also acknowledged in 2019 that breaking into the U.S. market would be difficult. “It’s going to be a very difficult path and we have to work a lot,” he said. “But there’s only one way ahead.”

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