In a bold move to strengthen the company’s financial footing and accelerate its electric vehicle (EV) innovation, Pham Nhat Vuong, founder of Vietnamese automaker VinFast, has committed $1.52 billion to acquire the company’s research and development arm, Novatech Research and Development JSC.
The transaction marks Vuong’s latest significant investment in the loss-making EV manufacturer as it pushes toward its ambitious target of breaking even by the end of 2026.
Inside the Novatech Acquisition
VinFast announced in a filing to the U.S. Securities and Exchange Commission (SEC) that Novatech, currently part of VinFast Trading and Production JSC (VFTP), will be carved out and sold to Vuong.
- Novatech will take ownership of investments linked to completed R&D projects.
- VFTP will remain responsible for ongoing EV production and future research operations in Vietnam.
- Intellectual property (IP) tied to Novatech’s R&D assets will be leased back to Vin Fast when required for manufacturing.
The agreed purchase price — nearly 40 trillion dong (about $1.52 billion) — reflects a fair value assessment of 17.25 trillion dong, plus a premium.
VinFast’s Financial Landscape
VinFast, which debuted on the Nasdaq stock exchange in 2023, has faced a challenging road in the competitive EV market. From weak global consumer demand to stiff competition from established players like Tesla and BYD, the company’s journey has been far from smooth.
In the first quarter of 2025, VinFast reported:
- Net loss: $712.4 million
- Revenue: $656.5 million — up 150% year-on-year
- R&D spending: $81.2 million — down 22.3% year-on-year
Despite these losses, Vin Fast’s stock showed a modest 1.4% increase to $3.59 in pre-market trading following news of the Novatech deal.
Why the Deal Matters
For Vuong, who controls around 98% of VinFast and its parent company Vingroup, the acquisition is more than a financial transaction — it’s a strategic bet on the company’s long-term future.
By moving R&D assets under his direct ownership, Vuong can:
- Inject immediate capital into VinFast to offset losses.
- Streamline R&D operations while keeping core production within VFTP.
- Maintain access to technology through the IP leasing arrangement.
Industry analysts note that the move could improve Vin Fast’s balance sheet while giving it more flexibility to attract external investors and strategic partners.
VinFast’s Growth Targets
Founded in 2017, VinFast has rapidly transformed from a domestic carmaker into an ambitious global EV brand. The company has already:
- Completed development of its first generation of EVs.
- Expanded into markets such as the U.S., Canada, and Europe.
- Built a strong domestic market presence in Vietnam.
Looking ahead, Vin Fast has set a 2025 delivery goal of 200,000 vehicles — more than double its 2024 total. The majority of these sales are expected to come from the Vietnamese market, where EV adoption is gaining momentum.
Challenges in the Global EV Market
Vin Fast’s growth plans come at a time when the global EV industry is experiencing both rapid innovation and intense price competition.
Key challenges include:
- Price wars initiated by market leaders such as Tesla, putting pressure on margins.
- Supply chain volatility impacting battery production and raw material costs.
- Consumer hesitancy in emerging markets due to charging infrastructure gaps.
Despite these hurdles, Vuong’s latest investment signals unwavering confidence in VinFast’s ability to carve out a space in the EV industry.
Founder’s Commitment – A Critical Lifeline
Since VinFast’s inception, Vuong’s personal wealth — derived largely from Vingroup’s diverse business empire — has been instrumental in financing the company’s aggressive expansion.
His continued backing:
- Provides liquidity for operations during loss-making periods.
- Boosts investor confidence by showing founder commitment.
- Enables long-term planning despite short-term market fluctuations.
This latest cash injection is not Vuong’s first — and industry observers believe it’s unlikely to be his last before VinFast reaches profitability.
VinFast’s Innovation Roadmap
With Novatech now under Vuong’s ownership but still tightly linked to Vin Fast’s operations, the company’s innovation pipeline is expected to remain strong.
VinFast is reportedly focusing on:
- Second-generation EV platforms with improved range and performance.
- Software-driven features including autonomous driving capabilities.
- Battery technology advancements for faster charging and longer lifespan.
The IP lease-back arrangement ensures that these innovations remain integrated into VinFast’s manufacturing process without interruption.
Investor and Market Reaction
While VinFast’s stock price has been volatile since its Nasdaq debut, news of the Novatech deal provided a small confidence boost.
Some market analysts view the transaction as:
- A short-term liquidity boost to manage ongoing losses.
- A structural shift that may make future fundraising easier.
- A signal that Vuong is willing to personally absorb risk to keep Vin Fast’s growth plans on track.
The Road to 2026 Profitability
VinFast’s stated goal is to break even by the end of 2026. Achieving this will require:
- Doubling production and sales in the next two years.
- Expanding charging infrastructure partnerships in key markets.
- Controlling production costs through efficiency and localized supply chains.
- Leveraging Vuong’s capital support until operating cash flows turn positive.
VinFast–Novatech Deal at a Glance
- Buyer: Pham Nhat Vuong, VinFast founder & Vingroup chairman
- Seller: VinFast Trading and Production JSC (VFTP)
- Asset: Novatech Research and Development JSC
- Value: ~$1.52 billion (40 trillion dong)
- Purpose: Capital injection, R&D restructuring, IP lease-back for manufacturing
- Goal: Strengthen finances, support EV innovation, reach break-even by 2026