Vinasun reports abysmal third quarter

Vinasun reported double digit losses and 2,000 employees leaving the company in the third quarter only

According to the company’s financial report, as of the end of the third quarter, Vinasun had 7,292 employees, decreasing by nearly 2,000 people since the end of the second quarter.

In the nine months of the year, along with the plunge in employees, Vinasun reported a revenue of VND2.45 trillion ($107.9 million), equaling 58 per cent of its initial annual target.

In the third quarter of this year alone, Vinasun reported double-digit losses. Notably, its net revenue was VND547 billion ($24.1 million) only, a record low record since the end of 2011.

Transport services via taxi is considered its core business, contributing the largest part to the company’s consolidated revenue, however, this revenue saw a plunge of VND1.5 trillion ($66.06 million) in the third quarter.

In the face of fierce competition with Uber and Grab, Vinasun set lower consolidated revenue and consolidated pre-tax profit targets for the whole year. Notably, in 2017, it targeted to earn VND4.26 trillion ($187.6 million) in revenue and VND205 billion ($9.02 million) in pre-tax profit, signifying increases of 10.6 per cent in revenue and 34 per cent in pre-tax profit.

In order to recover from the bleak business results, Vinasun is considering developing motorbike transportation services to lure in customers as well as compete with uberMoto and GrabBike.

Besides, it has implemented its own ride hailing application with an interface similar to those of Uber and Grab.

Furthermore, it has implemented the plan to extend its markets through M&A deals. According to the latest move, Vinasun spent VND27 billion ($1.19 million) taking over the assets and the right to exploit the trademark of the Vinasa taxi brand in the southern provinces of Dong Thap, Vinh Long, Can Tho, and An Giang.

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