Vietnam’s EV maker VinFast is on track to start production in the U.S. in 2024

Vietnamese electric vehicle maker VinFast told CNBC it’s on track to start production in the U.S. by 2024 even though the company is cutting its headcount in North America.

Vietnam’s first domestic automaker previously announced plans to go public in the U.S.

Just this week, VinFast — the automotive arm of Vietnam’s biggest conglomerate Vingroup — announced it will be cutting jobs in the U.S. in a restructuring exercise that will consolidate its operations across the U.S. and Canada.

“After last year’s observation, we see a lot of similarity in the two markets and consolidating the two markets will allow us to be stronger and more agile,” said Le Thi Thu Thuy, VinFast CEO, in an interview with CNBC’s J.P. Ong on Friday.

The news about the job cuts come on the heels of a Reuters report on Feb. 3 that VinFast will be delaying deliveries to its first customers in the U.S.

VinFast shipped its first batch of cars to the U.S. in November, which included 999 VF 8s. It had plans to deliver them by the end of December but has since delayed shipments to February.

Le told CNBC on Friday they have about 12,000 pre-orders in the U.S.

The automaker has been ramping up its U.S. expansion to take on American automakers such as Tesla and announced it will be setting up a production plant in North Carolina to manufacture EVs.

Le said the layoffs will not affect the planned timeline for production to commence at its first North American manufacturing plant.

“We are in the final stages of getting a permit to test the construction but the land has already been cleared. The state has already worked on the infrastructure for the land as well,” she told CNBC.

“We still plan to start the trial production in 2024 as originally planned,” Le said. The annual production capacity of the plant is 150,000 electric vehicles, according to the company’s release.

The next markets VinFast plans to target will be in Europe, namely Germany, France and the Netherlands, said the CEO.

However, VinFast vehicles do not currently qualify for the $7,500 tax credit in the U.S. because they are not built in the country, but are built in Vietnam. Prices for the 2023 VinFast VF 8 model start from $40,700.

“We immediately accelerated our plan for the North Carolina plant. Luckily, we had already signed that agreement before the Inflation Reduction Act,” Le said.

“We didn’t see it coming but we always [planned] to have a plant in the U.S. so the IRA increased our manufacturing capability in the U.S. to make sure that our customers will be able to have access to electric vehicles at a reasonable pricing.”

“I believe that in the long run [we are] going to concentrate the manufacturing of electric vehicles as well as the key components of electric vehicles in the U.S.,” Le added.

VinFast filed for an initial public offering in the U.S. on Dec. 6. They have not disclosed the number nor price of the shares to be traded, according to its prospectus. It is also not known when they exactly plan to list.

“We have been watching the intensity of the market and I think this year, the market has been a little bit better. We are ready but we need the market to be more cooperative for us to make the IPO happen,” said Le.

When asked about when the IPO is expected to happen, she said: “When we are ready to talk more about it, we will be happy to share more.”