Now that the VinFast VF 8 is more expensive than a Tesla Model Y

Following Tesla's massive price cuts in the US last week, Vietnamese automaker VinFast said it plans promotions to protect the competitiveness of its models.

Vietnam's electric-vehicle (EV) maker VinFast said on Thursday it will launch promotions to protect the market competitiveness of its models, a week after Tesla (TSLA.O) announced aggressive discounting to spur demand.

VinFast, which started operations in 2019, is gearing up to expand in the United States, where it hopes to compete with existing automakers by offering two models, the VF8 and VF9, which have starting prices of $59,000 and $83,000, respectively. With the Tesla Model Y now starting at $52,990 in the US, the similarly sized VinFast VF 8 is significantly more expensive.

Tesla is offering its basic Model Y at $52,990 in the U.S. market, a reduction from $65,990.

“As a new brand entering the market, when other brands reduce their prices we have to come up with promotions to ensure VinFast's competitiveness,” a VinFast spokesperson said in a statement cited by Reuters. “We are considering many promotion programs and will announce soon,” he added, without saying whether the promotions would include price cuts.

VinFast started shipping its first batch of 999 VF8 electric vehicles to the United States in late November and aims to deliver them to customers this month, the company spokesperson added. The carmaker claims to have secured almost 65,000 orders worldwide and targets annual sales of 750,000 EVs by 2026.

The automaker announced at CES 2023 the specifications of two new electric crossovers it plans to launch in the US, the VF 6 subcompact and VF 7 compact.

VinFast said early reservations for both vehicles will begin in March 2023. These models are expected to start US deliveries before the end of the year, taking VinFast's US lineup to four models only a year after the launch of its first product.

The automaker plans to build an EV plant in North Carolina and is awaiting final regulatory approval from local officials. The US plant will allow VinFast to qualify for federal tax credits and better serve the market.

The investment was announced in March 2022, when VinFast pledged to invest $4 billion in a new EV and battery plant in Chatham County, North Carolina. The company plans to build the VF 8 and VF 9 SUVs there, with production expected to start in July 2024.

In July 2022, North Carolina announced a $1.2 billion incentive package for VinFast's EV manufacturing project, the largest economic incentive package in the state's history.