Vietnam's Taxi King Posts Its First Loss in Five Years

[Vietnam's Taxi King Posts Its First Loss in Five Years]

Vinasun is Ho Chi Minh City's old-line taxi company and was once the leader of Vietnam's traditional taxi market. Its half-year financial statements, published at the end of August, show an after-tax loss of VND 13.9 billion, against a profit a year earlier. The last time Vinasun lost money was the end of 2021, just after Ho Chi Minh City came out of pandemic lockdown. Every quarter since had been profitable. This is the first loss in almost five years.

First-half revenue slipped by less than a tenth, but operating costs barely moved. Vinasun's explanation to regulators was one sentence long: revenue fell, and the company kept subsidizing its drivers. After the Gulf crisis sent fuel prices soaring at the end of February, the company decided to subsidize its drivers; the first quarter was still marginally profitable, and the loss landed in the second. Vinasun had also long relied on selling old cars to prop up its profit. In 2024 most of its profit came from that side business, which means the core taxi business was already running on thin margins. This year, selling old cars produced a loss.

Vinasun peaked in 2016, with revenue of VND 4.52 trillion and 17,000 employees. That was also the year Grab began visibly taking its customers: the apps were convenient, cheap and let riders track the trip, so passengers switched fast. Ride-hailing cars like Grab's are registered as "contract vehicles," and Ho Chi Minh City went from a few hundred of them before 2016 to more than 20,000 by the end of 2017. In 2017 Vinasun terminated the contracts of nearly half its salaried drivers and switched them to leasing cars from the company, no longer paying their social insurance. Headcount has fallen ever since. By the end of June this year it was below a tenth of the 2016 level, and 2025 revenue was a fifth of the peak. The company itself admits its app's positioning, online payment and invoicing still need work.

After Grab came a second rival, Xanh SM, renamed Green SM this year; this article keeps the old name. Xanh SM is an electric taxi brand set up by Phạm Nhật Vượng, the chairman of Vingroup, as a personal venture, and it started operating in 2023. By around the end of 2024, according to estimates by market research firm Mordor Intelligence, Xanh SM had overtaken Grab as Vietnam's largest four-wheel ride-hailing operator. Vinasun's share was down to about 2%, and later reports stopped listing it separately; in the first quarter of this year, Mordor put Xanh SM above 50%. These are estimates, and both Grab and Vinasun say they never supplied data to Mordor. Vinasun's own executives have conceded the gap in resources to shareholders: Vinasun's equity is roughly VND 1 trillion, while GSM, the company that operates Xanh SM, raised its charter capital to VND 54 trillion this June.

Vinasun's answer has been to change the cars, not the business model. It still owns the vehicles, employs the drivers and dispatches the rides. Since 2024 it has been buying Toyota hybrids, and by the end of last year more than half the fleet was hybrid. The company's explanation to shareholders is that hybrids save fuel and do not need charging time; the media read it as a refusal to join a cash-burning race. The driver model has not been touched since 2017: salaried drivers are managed centrally, while franchise and partner drivers lease or buy cars from the company and are not counted as employees. Mai Linh, Vietnam's oldest taxi company, took a different approach, signing with GSM at the end of 2024 to buy and lease thousands of VinFast electric cars to be brought onto the Xanh SM platform.

Whether the hybrid road leads anywhere depends on rules the government has not finished writing. In May, a consultancy commissioned by Ho Chi Minh City's Department of Construction presented a draft green-transition plan: all taxis citywide switch to electric or green energy from 2030, with a separate low-emission zone in the urban core. The question is how the draft treats hybrids. It lists "hybrid" and "green-energy" vehicles as separate categories. For contract vehicles under nine seats inside the zone, the Grab category, it is explicit: from 2030 electric, green-energy "or hybrid" vehicles may keep operating, with a full switch to electric or green-energy vehicles by 2035. For taxis, it only says "electric or green energy," and hybrids are not listed. And Vinasun has just converted half its fleet to hybrids. The draft is still out for consultation and has not been submitted to the city's People's Council.

Chairman Tạ Long Hỷ told the annual meeting that many traditional taxi brands have already fallen behind in the fight for market share, Vinasun is still operating, and the plan is to grow slowly and wait for an opening. This year's profit target is lower than last year's, and there will be no dividend. Two things will decide what happens next: when Ho Chi Minh City finalizes its draft and how it defines "green energy," and whether Vinasun can get back to break-even in the third quarter.

This article summarizes public financial statements and market information. It is not investment advice.

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