Automaker Thaco to cover 20% of high-speed railroad $61B cost: chairman

It has sought the government’s green light to build the rail in seven years with 20% equity and 80% from domestic and foreign loans.

The estimated cost does not include compensation for lands and resettling people who have to make way, which the government will manage as a separate project.

In a letter to shareholders, partners and employees last Friday, Duong said Thaco would set up a separate company for the project with capital of around VND312 trillion, equivalent to the 20% it will bring in.

Thaco plans to own a minimum of 51% of that company, meaning it has to cough up at least VND159.12 trillion, and sell the rest to other investors, including private and state-owned firms.

"This amount will mostly come from selling stakes and raising equity at Thaco and its subsidiaries," Duong said.

He added that Thaco could also take from its post-tax profit, which is estimated at VND15 trillion per year, if needed.

Duong and his family could sell stakes in the group, currently at around 72%, until they retain just 51%. Thaco could also sell shares of its subsidiaries while still retaining controlling interests in them.

Many of the group's subsidiaries, such as logistics firm Thilogi, infrastructure developer Thadico and agriculture firm Thaco Agri, are fully owned either by Thaco or by Duong and his family.

This way, Thaco might even be able to pay the 20% share on its own, Duong said.

Tran Ba Duong, chairman of automaker Thaco, at a meeting with government officials on May 2, 2025. Photo by VGP

For the loans to cover the remaining 80% of the rail project cost, Thaco has asked the government for guarantees and subsidize the interest for 30 years.

Duong said the money would be fully disbursed within seven years from the time the government hands over the required land.

Thaco had conducted "thorough research" before submitting its proposal and would continue exploring ways to lower costs, he said.

The transnational high-speed rail project requires complex technologies and very high standards for safety.

Duong said this does pose challenges but is also an opportunity for Thaco and the Vietnamese business community to develop local industries such as metallurgy and precision engineering.

VinSpeed, a newly established firm under billionaire Pham Nhat Vuong’s conglomerate Vingroup, has also offered to build the railroad and at the same cost.

It said it could begin construction this year and have the route operational before December 2030.

It has also offered to put in 20% of the cost and secure the rest through a zero-interest loan from the government to be repaid over a 35-year period.