by Brian Balfour
Senior Vice President of Research, John Locke Foundation
Vietnamese EV car maker VinFast reportedly lost nearly $600 million in the first quarter 2023. This comes on the heels of the company’s losses of $2.1 billion last year and $1.3 billion in 2021.
The financial losses are the latest in a string of bad news for VinFast. A recall of all of the 999 VF8 2023 vehicles sold in the U.S. was issued last month due to safety concerns. Moreover, VinFast’s latest model has been nearly universally panned as “abysmal,” “very, very bad,” and “simply unacceptable” by major auto publications.
VinFast’s failure is of course notable due to Gov. Roy Cooper’s decision to offer tax incentives totaling more than $760 million over the next 32 years (Chatham County kicked in another $400 million in incentives).
But now, in light of the state Senate’s budget proposal that includes a $1.4 billion appropriation of taxpayer dollars to a nonprofit group called NCInnovation, VinFast’s trouble takes on a new meaning as well. Part of NCInnovation’s mission would include using your tax dollars to invest in various start-up companies bringing university research to market.
So, what sort of innovative companies could we expect NCInnovation to invest in?
In a promotional brochure, NCInnovation highlights a few recent “intentional innovation efforts” as success stories. One of those examples is – you guessed it – VinFast.
Government not only should not be in the business of picking winners and losers in the marketplace with taxpayer dollars, it has a very poor track record of doing so.
Of course businesses fail all the time. The problem is that government-funded programs like NCInnovation force taxpayers to become investors in businesses against their will.