In the first half of 2024, Vietnam Railways (VNR) reported impressive financial results, with a revenue of over VND 4,500 billion, marking a 10.1% growth compared to the same period last year. This equates to an average daily revenue of over VND 24.7 billion, a record-breaking achievement for the company, even surpassing the pre-pandemic years from 2019 to 2021. Notably, the parent company alone accounted for nearly VND 3,000 billion in revenue, an 11.2% increase from 2023.
According to the management of Vietnam Railways, passenger transport volume in the first six months of 2024 increased by 20.6% year-on-year. Specifically, during the Tet holiday, VNR sold over 650,000 train tickets, generating a revenue of VND 400.7 billion, a 7.5% rise compared to 2023.
Vietnam Railways achieves record-high revenue in the first half of 2024. Source: ITN
For the full year of 2024, Vietnam Railways has set a revenue target of VND 6,258 billion. With the strong performance in the first half, VNR has already achieved nearly 72% of its annual plan. In 2023, the company turned a profit of VND 77 billion, marking a turnaround after three years of losses.
VNR has introduced specialized trains with regional cultural touches, such as the “Connecting Heritage” route between Hue and Danang, the “Dalat Night Journey” train, and charter trains with customized itineraries and services. Additionally, the company has improved and expanded its international transport services, including the operation of international freight trains between Vietnam and China, and the transit of goods through China to Russia, Europe, Mongolia, and Central Asia.
Vietnam Railways Encounters Two Major Incidents
Despite the impressive financial performance, Vietnam Railways faced two significant challenges in the first half of 2024: landslides at the Bai Gio and Chi Thanh tunnels, which blocked the Hanoi-Ho Chi Minh City railway line.
In response to these incidents, the transport companies promptly organized passenger transfers through the affected areas, ensuring their safety. Free meals and drinks were provided during the transfer process. For passengers who chose not to transfer, ticket changes and refunds were smoothly and promptly facilitated without any additional charges.
However, according to the Chief of Staff of Vietnam Railways, the incidents led to unexpected costs and indirect losses of over VND 106 billion for the company.
In the future, VNR plans to merge the Hanoi and Saigon Railway Companies into a single entity. Source: Illustrative image
Looking ahead, Mr. Hoang Gia Khanh, General Director of Vietnam Railways, shared that the company has initiated a restructuring process. Specifically, plans to merge the Hanoi and Saigon Railway Companies into a single Railway Transport Company have been finalized. This merger has been approved by the shareholders and boards of directors of both companies, and the necessary agreements have been signed. The two companies are now working on the necessary procedures to finalize the merger.
In reality, within the Vietnam Railways ecosystem, Hanoi Railway and Saigon Railway are the two largest members. In 2023, both companies showed positive financial signs, with profits of VND 14 billion and VND 11 billion, respectively. In the first quarter of 2024, both companies experienced favorable business conditions and reported profits three times higher than the annual plan due to increased travel demand.
Vietnam Railways has 25 subsidiaries, 17 directly affiliated units, and 8 joint venture and associated companies. The company is responsible for managing the railway infrastructure system, totaling 3,143 kilometers in length, including 15 routes passing through 34 provinces and cities from North to South.
For the remaining six months of 2024, Mr. Hoang Gia Khanh stated that Vietnam Railways would focus on implementing the restructuring plan as per the Prime Minister’s Decision No. 562 and completing the aforementioned merger according to the set timeline.
Furthermore, VNR will direct the transport companies to enhance service quality, particularly addressing limitations and issues raised by customers, such as improving toilet facilities and adding more equipment and services on board. The company will also work on the train schedule, including plans for the upcoming Tet holiday in 2025…
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