Vinfast becomes world's third-most valuable carmaker after Tesla and Toyota

Shares of Vietnamese electric-vehicle maker Vinfast surged 21% on Monday, extending a rally from last week that more than quadrupled its market value to $160 billion.

The company made a blowout debut on Wall Street this month and has quickly grown in valuation to become the third-most valuable automaker - only behind Tesla and Toyota.

But Vinfast's small amount of publicly available shares has made the stock prone to volatility, with shares jumping or slumping more than 14% in 11 of the past 12 sessions.

The stock was on track to add nearly $33.6 billion to its market capitalization, based on a share price of $83.33.

Vinfast's shares were among the most actively watched on Stocktwits, a popular website with retail investors.

Vinfast is almost entirely controlled by Pham Nhat Vuong, Vietnam's richest man and founder of parent conglomerate Vingroup, with a stake of about 99.7%, according to a filing.

Despite the market enthusiasm, Vinfast faces a long road before it can start competing meaningfully with Tesla and legacy automakers that are pouring billions of dollars to grab a share of the EV market.

Only 137 Vinfast EVs were registered in the United States through June, according to S&P Global Mobility.

The firm is also entering the US and European markets at a time when EV demand is slowing and Tesla has waged a price war to defend its dominance.

Vinfast expects to sell as many as 50,000 electric vehicles this year, compared with Tesla's projection to deliver 1.8 million cars.

To drive sales, Vinfast is breaking away from the direct-to-consumer approach used by Tesla and turning to dealers. The company is also building a $4 billion factory in North Carolina.