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COMMITMENTS AND CONTINGENCIES | 12 Months Ended
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Dec. 31, 2023
COMMITMENTS AND CONTINGENCIES |
COMMITMENTS AND CONTINGENCIES | 25.COMMITMENTS AND CONTINGENCIES Commitments related to the development of the projects and products The Group signed contracts relating to the purchase and installation of machinery and equipment, information technology systems and deployment of site clearance, construction of factories and development of products. The estimated commitment amount of these contracts as of December 31, 2023 was VND13,198.2 billion (USD553.0 million) (December 31, 2022: VND18,498.9 billion). Commitments related to the minimum purchase commitment The Group signed the contracts with certain suppliers to agree the minimum purchase volume in which the Group committed and promised that the annual purchase volume from these suppliers is not lower than the quantity agreed upon by the two parties in the signed contract and/or other accompanying documents. In case of shortfall purchase, the suppliers will reserve the right to revise the quotation and component pricing or are entitled to compensation from the Group. If the specified minimum quantities are not reached, the Group is relieved from the obligation when the necessary waivers are obtained. Contingent liabilities related to contract termination penalty The Group has estimated the compensation expenses deriving from early termination of contracts with suppliers as result of the Group’s ceasation of production or development of certain vehicle models. The Group is in the process of negotiating with suppliers to finalize the compensation expenses. The ultimate resolution of the matter could result in a loss of up to VND421.6 billion (USD17.7 million) in excess of the amount accrued. Other commitments Under the agreement signed between VinFast Vietnam and World Triathlon Corporation, VinFast Vietnam is the Event Title Partner of Ironman World Championship event series. The Group has committed to paying the annual fees with total remaining amount of VND207.6 billion (USD8.7 million) until the end of 2025. The Group has engaged in a contract to buy engines from a supplier. As per the terms of this agreement, the Group anticipates incurring a loss of VND84 billion (equivalent to USD3.52 million) when fulfilling the remaining obligations of the contract.

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