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High-Speed Rail Vehicles Vietnam

Vietnam Looks to Fund $56 Billion High-Speed System Between Hanoi and Ho Chi Minh City

Project requires help from international organizations such as the World Bank and the Asian Development Bank before it can get off the ground.

Vietnam Railways Corp announced today that it will use Japanese Shinkansen technology for its planned high-speed rail line between the capital Hanoi and Ho Chi Minh City. The 1,000-mi railway will replace a train line originally built during French colonial control, covering most of the country’s north-south length. Though the mammoth project has yet to be funded, Japanese train manufacturers took heart in the news as they begin their push into international markets such as the United States.

Hanoi and Ho Chi Mihn City are Vietnam’s two largest cities, and their metropolitan areas represent about 10% of the country’s population alone. The new railway would also provide fast access to major cities such as Vinh and Nha Trang, each on the country’s coast. The first phase of the project would run between Hue and Da Nang, located sixty miles apart and about halfway between the line’s two planned termini. This section is seen as the most profitable of the whole corridor since its short travel time would allow daily commuting. A full-distance trip between Hanoi and Ho Chi Minh City would take about 5 hours in ideal conditions — trains running between the two today need a full three days to do as much.

The relatively poor Vietnamese government will not be able to finance the project itself and is looking to Japan, the World Bank, and the Asian Development Bank for funds. If enough cash is identified, the system would be up and operating by 2020, though that timeline seems optimistic and Japan itself has argued that Vietnam wait until the mid-2030s or later to begin services.

One wonders whether Vietnam’s choice of Japanese train technology is more a reflection of the country’s desire for Japanese aid than an actual reflection of the advantages of Shinkansen. Nonetheless, this is big news for companies such as Kawasaki and Nippon Sharyo, whose operations have been confined to the domestic market until the recent opening of Taiwan’s high-speed rail. Some Chinese high-speed operations use Shinkansen technology as well.

European rivals have been quick to capitalize on investment in fast trains in Russia, China, Spain, Saudi Arabia, and Argentina, among other countries, leaving the Japanese companies behind on the international scene. Scoring the Vietnamese contract proves that they will be prepared for future competition worldwide and specifically in the potentially largest market, the United States, where Alstom, Siemens, Bombardier, and even Korean companies are already pushing their wares.