Recently, Mr. Pham Nhat Vuong – Vietnam’s richest billionaire had an interview with Bloomberg. There he shared a great deal about his great ambition to reach out to the world with the products the company was involved in including cars and ventilators.
Below is a translation of this article.
By this time, Vietnam had partially won the Covid-19 epidemic. The country has recorded only 332 cases and no deaths. However, responding from the company’s headquarters in Hanoi, billionaire Pham Nhat Vuong – Chairman of Vingroup shares about his vision beyond his borders. In April, the richest man in Vietnam carefully observed his entire empire and made a decision. He will produce ventilators!
During the worst of the Covid-19 epidemic, the corona virus struck the patient’s lungs and the ventilator was what could save them between the boundary of life and death. By one estimate, hospitals around the world can use an additional 800,000 other ventilators.
Lack of ventilators is an urgent problem in developing countries like South Sudan, for example, they have only 4 ventilators for a population of 12 million. But rich countries also experience similar situations. After receiving reports of a shortage in New York hospitals, President Donald Trump called on carmakers and a number of other American companies to start manufacturing the device, Ford Motor Co. and GE cooperated to deliver 50,000 ventilators until July 13 in a $ 336 million contract with the government.
Mr. Vuong believes that his Vingroup group can do it faster and cheaper than that. Using open source designs from equipment manufacturers like Medtronic, Vingroup submitted its first ventilator to apply for a license in mid-April. While the company was waiting for a license, the ventilator was in production on the line.
Vingroup ventilator costs $ 7,000 in Vietnam, 30% lower than Medtronic model. The company also says it can produce 55,000 units a month as soon as the government licenses it and plans to export it to anywhere in the world in need. Vingroup said it would donate thousands of them to Ukraine and Russia – the places Mr. Vuong had been with when he first started his career.
“In the coming time, we will focus on producing many ventilators and do well. We want to join hands with the Vietnamese government to partially solve the pandemic problem,” Mr. Vuong told Bloomberg interview.
Vingroup itself runs many hospitals and clinics, but becoming a manufacturer of medical devices is not completely planned. However, as soon as the country called for increased localization of complex products, Vingroup immediately began manufacturing cars and smartphones.
Producing ventilators is only part of Mr. Vuong’s much more ambitious global campaign: Selling Vietnamese cars to the world. In December, he announced that Vinfast, the group’s car manufacturing arm, would develop an electric car and export it to the United States by 2021. Vuong used his own pocket money of $ 2 billion to turn this ambition on. reality.
“There are very few companies that can do it like Vingroup, their ambitions are staggering.”
Although Americans may still be skeptical of Vietnamese cars, the breathing apparatus is different. Countries that are struggling with viruses cannot refuse this product. “The lesson we learn from the crisis is that there are always lots of opportunities. We have to make the right choices and act quickly.”
Over the past 2 decades, Vietnam has become one of the fastest growing economies in the world. Average income has increased more than 6 times and before the pandemic, Vuong believed that he had to build the company fast enough to keep pace with the country’s middle class development. Currently, Vingroup is involved in many areas, taking care of customers from childhood to old age.
A child can be born at Vinmec Hospital, grow up in Vinhome houses, study at Vinschool and enter VinUniversity University. A family can ride Vinfast and relax at Vinpearl In daily life, they can chat via Vinsmart phones and shop at Vincom shopping center.
What Mr. Vuong wants is to have an international identity, especially in the US – the world’s largest and most competitive economy. “A lot of Americans still think that Vietnam is a poor country and does not have high-tech products.” The successful global introduction of Vingroup products such as cars or ventilators can change the way the world sees Vietnam.
“Our mission and responsibility is to develop Vietnamese brand name with a world-class reputation.”
Breathing apparatus can demonstrate a strategic introduction to the global market. If Vingroup can produce exactly what Mr. Vuong says, it will address the global shortage, leveraging the Medtronic brand as a manufacturer of medical devices with a history. And if the ventilator is good, Vingroup will demonstrate the ability to hand over a complex, reliable and potentially life-saving device.
The company set up its first ventilator production line in less than a month, collapsed three transfer lines in its new 7-month-old smartphone factory. Vinfast engineers will design and Medtronic representative to advise workers.
“There are very few companies in the world doing so. Their ambition is amazing. This could be a big victory to turn Vietnam into a global player,” said Mark Mobius – founder of Mobius Capital. Partner – the unit investing in Vietnam during the last decade said.
Mr. Vuong’s ambition to expand globally has been emphasized recently. Vingroup still employs hundreds of engineers to expand its research and development center in Australia to develop a new Vinfast vehicle model. The company also wants to buy Australian carmaker Holden.
“Mr. Vuong is extremely ambitious but has practical tests,” said Michael Dunne, CEO of ZoZo Go.
Vuong remembers a legend in the automobile industry, Li Shu Fu, the chairman of China’s largest private car manufacturer Geely Automotive Holdings. Famous for acquiring Volvo from Ford in 2010, Li turned his company into the dominant power in the Chinese auto market. And like Vuong, Li has ambitions to go to America.
Mr. Vuong has repeatedly led the company to escape from the previous difficult period. In 2011, when Vietnam’s largest inflation hit 23% and the real estate market collapsed, the company’s net profit fell 64% that year. They merged real estate and tourism to form Vingroup.
Merging operations have created efficiency. Net sales hit 2012 records and profits have recovered. Since then, revenue has grown 17 times, reaching VND 130.8 trillion (US $ 5.6 billion) in 2019. Last year, the company restructured, abandoned the plan to set up an airline and sell the chain. Vinmart retail as well as Vineco agricultural segment.
“Don’t let life pass meaninglessly”
“The current businesses have the greatest potential. We will not change our strategy. If the global recession worsens, we will just adjust a few short-term plans.”
Vinfast launched three models last year and received 17,000 orders. In November, they planned to launch the first electric vehicle at the Los Angeles Auto Show. Vingroup said it plans to export electric vehicles to the United States in 2021 or 2022 “not at all”.
Even so, many questions remain open. Tesla, the leading company in the US with electric vehicles, has never had a profitable year. Many Chinese electric vehicle startups are “in the same situation. You not only enter the US market but also have to do it quickly”.
But Mr. Vuong is not afraid of risks, “any company can collapse”. And for those who are skeptical of electric cars, Vuong only says that Vinfast has turned the swamp into a modern car factory, mostly automated lines and delivered cars during the past 21 months.
Now, the phone factory is partially relocated to make ventilators. About 70% of raw materials are locally imported and can access most of the supply chain. Only 85 employees are producing 160 ventilators a day when the company is waiting for final approval and then it will start mass production.
Mr. Vuong said that the current price of ventilator is lower than the price. “The goal of manufacturing ventilators is to contribute to society in difficult circumstances. We have no plans to expand into this field.”
Mr. Vuong once said: “I always tell my colleagues that do not let life go by meaningless. Do not let the end of your life, you have nothing worth remembering or recalling. It will be a bad ending when life Your does not have any additional values ”.