Tesla boss Elon Musk is receiving competition from the unlikeliest of all contenders.

On the surface, perhaps the only remarkable thing about VinFast Auto is just how quickly its freshman SUV earned a reputation as the worst-built electric vehicle to hit the U.S. market this year.

The VF8 was mercilessly panned by motoring critics, and the company has even begun offering cash back to unhappy customers.

Yet Vietnam’s first-ever attempt at building a national automotive champion, which listed on the Nasdaq last week via a SPAC merger, is already the fourth most important carmaker in the world when measured by one key metric: its stock price.

On August 22, shares more than doubled in value, pushing VinFast’s market cap to $100 billion at one point in the trading session.

Even after giving up some of its substantial intraday gains, it still easily surpasses highly profitable luxury brands like Mercedes-Benz and BMW, as well as Warren Buffett–backed Chinese EV company BYD, when it comes to valuations.

By market cap, Tesla is still the world’s largest automaker with a value of around $740 billion.

The only fundamental stock driver to emerge on August 22 were results showing VinFast’s latest U.S. model, the upcoming three-row VF9 crossover, had earned an EPA-certified range of up to 330 miles that surpassed its own initial estimates.

But that alone is arguably not a justification for such a large swing in price even for a speculative growth stock like VinFast.

Nor has range been a primary concern among reviewers that tested the VF8—instead build quality was the key issue, with numerous problems emerging during even brief initial test drives.

It got so bad that in mid-June, VinFast launched a new “special aftersales policy” entitling owners to sometimes hundreds of dollars in cash for each problem they encountered.

Ownership questions

It typically takes at least a decade and often a generation to build up automotive expertise.

As Musk himself realized during his “production hell” ramp-up of Tesla’s Model 3 six years ago: Building a prototype is easy; mass-producing a passenger car is hard.

In fact, only about a dozen countries have significant automotive clusters, and Vietnam is not one of them.

Last year it manufactured only around 230,000 motor vehicles—half as many as Morocco and fewer than Taiwan, according to industry lobby group OICA.

So, how can a six-year-old carmaker like VinFast, hailing from a country that has no material expertise in the sector, possibly be the world’s fourth most valuable car company?

Writing in the Financial Times this week, retired investment banker Craig Coben warned on August 21 this discrepancy was down to one important peculiarity.

VinFast’s founder, Pham Nhat Vuong, owns 99% of the shares. With less than 1% of the stock actually available for investor purchase, the tiniest shifts in volume can trigger large movements in price.

“That’s not just an aside: it is the story,” argued Coben, who spent years helping companies raise funding as head of equity capital markets for Bank of America.

“A stock market listing should provide price discovery and liquidity. VinFast shares have neither.”