Home Real Estate The High-Speed Rail Race: Unveiling the Contrasting Visions of Vietnam’s Billionaires.

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The High-Speed Rail Race: Unveiling the Contrasting Visions of Vietnam’s Billionaires.

29 May, 2025

Two prominent Vietnamese conglomerates, THACO and VinSpeed, have submitted proposals to invest in the North-South high-speed rail project, with a total investment of over $61 billion. While both companies aim to complete the project, they have proposed different approaches regarding finance, technology, incentives, and timelines.

Criteria	THACO	VinSpeed
Investment Type	Private investment under the Investment Law: establishing a project enterprise with THACO holding a controlling stake.	Private investment under the Investment Law; VinSpeed as the investor.
Total Investment	61.35 billion USD	61.35 billion USD
Capital Plan	– 20% self-funded and raised through equity issuance to Thaco and its ecosystem, equivalent to 12.27 billion USD – 80% borrowed from domestic and foreign credit institutions. Proposed government guarantee on the loan and full interest payment for 30 years.	– 20% of project capital self-financed, equivalent to 12.27 billion USD (excluding land clearance costs) – 80% borrowed from the State at a 0% interest rate for 35 years.
Completion Time	7 years, divided into 2 phases	5 years
Operation Period	70 years	99 years
Business Plan	Ticket prices approved by state agencies, ensuring the financial plan and payback period for the project.	Ticket prices approved by state agencies, ensuring the financial plan and payback period for the project.
Incentives	– Allocation of land for urban development following the TOD (Transit-Oriented Development) model – Exemption from import tax on machinery, equipment, and vehicles that cannot be produced domestically – Application of the most favorable special mechanisms and investment incentives under current regulations.	– Development of adjacent land funds at stations for urban areas and real estate projects
Technology and Technique	Commitment to electrification, international standards, technology transfer from Europe and Asia, and partial localization.	Agreements with leading railway industry countries such as China, Germany, and Japan for technology transfer and local production of locomotives, carriages, and signaling systems. Training human resources to master the technology.
Commitment	No transfer of capital/project to foreign countries; ready to hand over the entire project if requested by the State for national security reasons.	No specific mention in the publicly available proposal.

Regarding the investment type, both companies proposed a private investment approach, excluding the public-private partnership (PPP) model. According to the proposals, VinSpeed and THACO will directly act as investors under the Investment Law.

Considering the total investment and capital plan, both THACO and VinSpeed estimated a total investment of 61.35 billion USD, excluding land clearance and resettlement support costs.

THACO will contribute 20% of the total capital (nearly 12.3 billion USD) through owner’s equity and legal capital mobilization within the country. The remaining amount, approximately 49 billion USD, will be borrowed from domestic and foreign credit institutions. THACO proposed a government guarantee and support for the entire interest expense for 30 years, secured by assets formed from the project.

Similarly, VinSpeed divided the capital contribution into a 20%-80% ratio. The company committed to arranging 20% of the capital, equivalent to 12.27 billion USD (excluding land clearance costs), with the remaining 49 billion USD requested as an interest-free loan from the State for 35 years.

Typically, commercial borrowing incurs higher costs than capital mobilized from the State.

In terms of timeline, THACO proposed a two-phase implementation with a completion target of 7 years and an operational period of 70 years. The first 5 years will focus on constructing the segments from Ho Chi Minh City to Nha Trang and from Hanoi to Ha Tinh, once the government hands over the cleared land. These segments are chosen due to their high demand for passenger and cargo transportation, allowing for early operation and exploitation.

The second phase will complete the remaining segment from Ha Tinh to Nha Trang within the next 2 years. This segment involves challenging terrain and complex geology, requiring additional time for research and effective solutions.

On the other hand, VinSpeed expressed its desire to commence the project before December 2025 and operate the entire line before December 2030, resulting in a total estimated completion time of 5 years. The projected operation period for the project is approximately 99 years.

The North-South high-speed rail project has received approval for its investment policy from the National Assembly in Resolution 17/2/2024. The project spans 1,541 km, starting from the Ngoc Hoi station in Hanoi and ending at the Thu Thiem station in Ho Chi Minh City, passing through 20 provinces and cities. The entire line will be built with a double-track standard gauge of 1,435 mm, designed for a speed of 350 km/h and an axle load of 22.5 tons. There will be 23 passenger stations and 5 cargo stations. The project will be implemented with a public investment form, with an initial total investment of 1.713 million billion VND (over 67 billion USD).

Regarding the ecosystem scale, VinSpeed is backed by Vingroup and its ecosystem, including key members such as VinFast (automotive industry), Vinhomes (residential real estate, industrial real estate), Vincom Retail (retail real estate), Vinpearl (resort tourism), VinSchool/VinUni (education), and Vinmec (healthcare). It also has associations with companies like GSM and GF in the fields of transportation and car rental services. With VinFast listed in the US and Vingroup, Vinhomes, Vincom, and Vinpearl listed on the Ho Chi Minh City Stock Exchange (HOSE), the total value of this ecosystem is approximately 40 billion USD.

THACO also operates in multiple industries with six core member companies: Thaco Auto (automotive), Thaco Agri (agriculture), Thaco Industries (mechanics and supporting industries), Thilogi (logistics and transportation), Thadico Dai Quang Minh (investment and construction), and Thiso (retail). Aside from HAGL Agrico (code: HNG) acquired from HAGL of Mr. Doan Nguyen Duc (“Bầu Đức”), THACO’s ecosystem does not include any listed companies in the stock market.

Thao Van