Good morning! Hello to all new readers, and welcome to the latest edition of the Vietnam Weekly, written by Ho Chi Minh City-based reporter Mike Tatarski.
This week’s article for paying subscribers is about Hanoi’s first two metro lines, which I had the pleasure of riding recently. If you’re not a subscriber yet, you can upgrade to access that and all future exclusive articles below.
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The Vietnam Weekly Podcast returns with a new episode on Monday - find it on all major podcast platforms.
Speaking of the metro, the newer Nhổn-Hanoi line reportedly served 1 million passengers in its first month of operation. I also heard from a reader who said several of his employees use the Cát Linh - Hà Đông line every day, which is awesome.
A couple of quick items: Trương Mỹ Lan’s second trial - this time for bond fraud and money laundering - began in HCMC yesterday morning with heavy security and crowds outside the People’s Court. Lan was sentenced to death at the end of her first trial earlier this year, a verdict she appealed.
General Secretary and President Tô Lâm departs Sunday for a trip to the United States, followed by Cuba. He will attend the UN General Assembly and take part in a moderated conversation at Columbia University on Monday.
On to the news.
Yagi’s Cost
As northern Vietnam recovers from Typhoon Yagi, central provinces were hit by Tropical Storm Soulik yesterday, causing flooding in Đà Nẵng, landslides in mountainous areas, and the closure of Đồng Hới’s airport plus schools in Thừa Thiên Huế and Quảng Nam.
On Wednesday, Deputy Minister of Agriculture and Rural Development Nguyễn Hoàng Hiệp said the damage caused by Yagi could hit US$2.5 billion in value, significantly higher than the initial US$1.6 billion estimate announced by the Ministry of Planning and Investment.
Whatever the final figure, Yagi is already the most destructive typhoon in the country’s history, with its economic damage surpassing all natural disasters over the last three years combined.
The death toll stands at 291, with 39 people still missing and nearly 2,000 injured.
The government expects the storm to reduce year-end GDP growth by 0.15%, while the Ho Chi Minh City Securities Corporation placed this figure at 0.38%. Hải Phòng, Quảng Ninh, Thái Nguyên, and Lào Cai - the hardest-hit provinces and also key industrial areas (especially the first two) - could see growth slow by 0.5%.
On a more granular level, CEL Consulting surveyed 216 companies operating in Vietnam over the seven days following Yagi’s landfall to get a sense of the business impact. Overall, 15.4% faced severe disruptions, 53.6% experienced manageable delays, and 24.6% reported minor impacts. Supply chain and logistics businesses were hardest hit, with 82.4% of respondents in that sector reporting severe or moderate effects.
Agriculture was also badly impacted, with individual farmers likely reeling from losses: according to CEL, 262,000 hectares of rice, crops, and fruit trees were damaged or destroyed; 2,250 aquaculture farms were swept away; and nearly 2.3 million livestock and poultry died.
The tourism industry is back on its feet in some areas, with Sa Pa reopening several sites and Bản Giốc Waterfall in Cao Bằng accessible, while Hạ Long Bay cruises have resumed. Cát Bà, unfortunately, is in much worse shape - the scenic island bore the brunt of Yagi’s winds and is struggling to rebuild.
A VinFast Check-In
It’s been some time since I covered VinFast, so let’s run through the past couple of months for them. The carmaker is finally holding its Q2 earnings call today (7 pm Vietnam time) - the call was originally scheduled for mid-August but was quietly delayed.
It’s not clear why this happened, though on July 29, VF restated its 2023 financial statements due to “accounting errors” identified through an internal audit. These errors - which included invoicing 454 EVs and 2,192 e-scooters to GSM for fiscal year 2023 even though they weren’t delivered until 2024 - resulted in about US$27.7 million in overstated revenue.
In early August, VF began delivering the tiny, VND240 million VF3 to customers - I’ve seen a couple of them on the road, but GSM taxis continue to dominate.
Also last month, VF announced that it was postponing the opening of its dealership network in Thailand “amid a broad slowdown in passenger car sales in Southeast Asia's second-largest economy.”
EV sales in Thailand this year have indeed come in below expectations, but they have still grown by about 5% over 2023. VF said it would “carefully evaluate” its Thai entrance, but reporting from Thai media casts doubt over this ever happening: one outlet spoke to dealership owners who had trained staff on VF’s offering and put up signage for the brand, only for them to reverse course.
Elsewhere, VF opened pre-orders for the VF3 in the Philippines on Tuesday and plans to launch the VF8 in Puerto Rico.
Tu Le of Sino Auto Insights test-drove a VF8 at the recent Electrify Everything Canada Conference in Vancouver. His takeaway:
“I tried to have an open mind about it and after I got out, I thought - not bad. Fit and finish was the worst of all the cars I drove that day, meaning that the materials, design and overall build quality wasn’t like the others, but I’ve seen a good deal of improvement since I first laid eyes on them.
As for driving, eh - it was the least compelling vehicle I drove. That said, it was the cheapest of the bunch, although not by much (vs the Blazer). The open question about Vinfast, who’s going to bankroll them moving forward? Expansion takes alot of capital and not Vietnamese Dong, more like a few dozen Brinks Trucks worth of Benjamins.
Be suspect of anyone that unapologetically sings it’s praises because it still needs some work to be able to compete with the legacies, let along China EV Inc.”
VF’s situation in the United States, meanwhile, remains deeply concerning: last week, the National Highway Traffic Safety Administration (NHTSA) opened a preliminary investigation into the VF8’s Lane Keep Assist system.
This follows multiple owner complaints and an April VF8 crash that killed a family of four in California - that accident is still under investigation by the NHTSA.
Extra Links:
Backlash Against Fulbright University Vietnam: Are Propagandists Barking Up the Wrong Tree? (Fulcrum)
Exclusive: Inside the US push to steer Vietnam's subsea cable plans away from China (Reuters)
The Women of Ho Chi Minh City (Atmos)
How the world’s smelliest fruit is making coffee more expensive (BBC - VPN needed in Vietnam)
Cambodia’s CLV-DTA Crackdown Shows Vietnam Is Still the Elephant in the Room (The Diplomat - VPN needed in Vietnam)
Have a great weekend!