Vietnam’s VinFast bets on EV taxis in Asia
The company is betting on ride-hailing in the region after stumbles in America
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Ride-hailing is on the agenda today as Grab is forced to defend its use of Chinese tech as its big Taiwan acquisition goes through the regulator phase, and Vietnam’s VinFast might finally have found a business that works.
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VinFast’s Green SM taxi service heads to India in wider Asia push
A new ride-hailing service is zooming through Asia after Green SM, the all EV taxi service from Vietnam’s VinFast, revealed plans to launch in India and expand its availability in the Philippines.
Green SM (the last part stands for smart mobility) was started in 2023 as a response to Vietnam’s national climate change goals. It is owned by Vingroup founder Pham Nhat Vuong, a billionaire whose areas of focus range from real estate and hospitality to healthcare, education and technology. VinFast is its take on Tesla, but it struggled to expand to the US market despite spending big on talent and talking big on ambition.
At its peak in 2023, VinFast listed on the Nasdaq via a merger. But its shares are down nearly 80% and it hasn’t delivered on plans to build in the US. VinFast was sued by North Carolina last month for failing to deliver on a promise to build a manufacturing facility in the state in a symbol of that failure. Broadly, it is seen as a company that tried to be like Tesla but failed rather embarrassingly.
Despite that all, however, Green SM looks like its most promising auto-related venture to date. The service is available in Vietnam, Laos, the Philippines and Indonesia. In the latter market, a tie-in with Gojek has helped its Cyan-coloured taxi pop up across Jakarta.
Now, it is pushing the pedal with plans to launch in India this Friday starting in Delhi. The rise of Rapido shows India has room for alternatives to Uber and Ola, but the startup focused on smaller cities and towns with a cost-conscious approach. It’s unclear if Green SM will take a similar approach. A challenger, EV-only ride-hailing firm in India may ring bells. BluSmart took a very similar position, raising more than $200 million from investors. Its business fell apart last year when it emerged that its founders committed fraud.
The service is also expanding in the Philippines, where it secured a $32.4 million loan from the Philippine National Bank to grow its local fleet. Operating there as Green GSM, the company has partnered with Xentro Group, a conglomerate best known for its malls and renewable energy interests.
It hasn’t all been smooth sailing for Green SM. One of its fleet stalled on a train crossing in April, causing a deadly crash that claimed 16 lives and triggered an investigation. That probe has been completed but there’s no word yet on what sanctions the company may face.
VinFast previously faced issues around its cars in the US, with some owners reporting erratic steering and crashes. With active taxi fleets in the 10,000s across multiple countries, VinFast should have ironed out those basic issues to give it a shot at growing the Green SM service. The ultimate goal may be to raise awareness of its EVs and increase their appeal to increase sales, because disrupting the ride-hailing market in Asia is no easy undertaking.
Grab defends China tech use as Taiwan reviews Foodpanda deal
Sticking with ride-hailing, Grab has been forced to defend its operations and data security after concerns were raised in Taiwan over its use of Chinese services.
Grab is awaiting regulatory approval for its acquisition of Foodpanda Taiwan for $600 million, but already it is on the back foot. Concerns were raised about the Singapore-based firm’s use of Huawei Petal Maps, a Google Maps alternative that’s part of its tech stack in Southeast Asia.
Grab said in a statement it would not use the Huawei service in Taiwan. It also pushed back on claims that it uses Chinese cloud storage for its data.
“We do not use Alibaba Cloud for the storage of Grab’s app data… Amazon Web Services is our preferred provider for our data storage needs for our core operations and infrastructure,” it added.
Pushback on the usage of Chinese service and support is wholly expected in Taiwan. The country’s antitrust regulator struck down Uber’s proposed purchase of Foodpanda Taiwan one year ago, and even though Grab is not currently active in the country, it is sure to shine that level of intensity on this deal.
By contrast, Grab’s acquisition of Uber’s Southeast Asia deal in 2018 was essentially waved through by regulators even though it represented a merger of two dominant businesses in nearly half a dozen countries, with the potential to negatively impact millions of gig economy workers. Singapore handed down a $9.5 million fine and required the Uber Singapore app to remain operational for 3 weeks longer than the companies had proposed.
Taiwan might look like a cakewalk, but Grab will need to up its government affairs game. Particularly if it continues to chase M&A and acquisitions.
In other Grab-related side quests, the company is exploring opportunities for autonomous vehicles and delivery robots in Vietnam
Deals
MUFG, Japan’s largest financial group, is launching a $250 million fund targeting early and growth-stage startups in India, with a focus on fintech [Economic Times]
Following MiniMax, Zhipu AI plans to seek a secondary listing in China to supplement its Hong Kong IPO in January [Reuters]
BlackRock will buy a 15.2% stake in Japanese taxi app Go for $175 million as part of the company’s Tokyo IPO [Nikkei Asia]
Korean rocket startup Unastella raised $24 million in a Series B round, bringing total funding to $44 million [TechCrunch]
Oyo’s parent company Prism has secured the market regulator approval to proceed with its IPO [Economic Times]
ONDC, India’s government-backed digital commerce network, raised $26 million from a group including Zoho, Uber, Paytm and BSE Technologies [Economic Times]
Markets
Didi posted a net loss of $177 million as it continues to spend big to battle competitors, particularly Meituan in Brazil, but revenue grew 10% year-on-year [Reuters]
Meituan, meanwhile, posted a $690 million loss down from $2.1 billion in the previous quarter, revenue rose 6% year-on-year [South China Morning Post]
In other news:
Geedge Networks, a Chinese company that sells a commercial version of China’s Great Firewall, is building AI tools designed to help authoritarian governments identify potential dissidents before they speak out [New York Times]
At least seven Chinese universities tied to the military and defence sector are seeking access to Nvidia’s H200 chips [Bloomberg]
Revolut has quietly rolled out its services to thousands of users in India ahead of broader launch [TechCrunch]
Coinbase is also making moves in India after it added support for direct rupee deposits and withdrawals in India, becoming the only international crypto exchange to offer the feature [Economic Times]