Hyundai Rotem's Vietnam Rail Deal: 1,024 km Metro Ambition

South Korea's Hyundai Rotem will hand over train-building technology to Vietnamese conglomerate Thaco, a step that turns the country's metro expansion into an industrial play. The agreement, signed June 11 in Hanoi, covers designs, documentation, manufacturing processes, and quality systems for locomotives and railcars, along with engineer training in South Korea and on-site support in Vietnam. Deputy general director Nguyen Quoc Trung of Thaco's real estate unit laid out the plan on June 18.

The deal builds on an April 23 contract for 162 railcars for Ho Chi Minh City's metro lines. Six of those will come fully assembled from South Korea. The other 156 will ship as knockdown kits, meaning Thaco will assemble them itself. That deliberate ladder matters: most cities that build metros import their trains. This arrangement pushes the local content higher, a shift that matters for any trader watching Southeast Asian supply chains.

Thaco plans to break ground in early July on a 320-hectare railway and engineering complex in what used to be Binh Duong Province. The site sits inside a 786-hectare industrial park. It will house factories for locomotives, railcars, tunnel boring machines, girder launchers, tunnel lining segments, and railway sleepers. Production is set to start in April 2027. Thaco says the trains will meet advanced European technical standards.

The complex feeds first into the metro lines Thaco is building in Ho Chi Minh City, then anchors a domestic railway supply chain. Thaco is better known as a carmaker. Its move into rail shows how Vietnam now leans on private companies for strategic infrastructure under special mechanisms the National Assembly approved in 2025 to accelerate urban rail.

The city's planned urban rail network runs to 1,024 kilometers across 27 lines after the 2025 boundary expansion. Today it operates just under 20 kilometers. That is the Ben Thanh-Suoi Tien line, which has carried more than 30 million passengers since opening in late 2024. The target is about 200 kilometers by 2030. Since late 2025 the city has broken ground on three projects: the Ben Thanh-Tham Luong and Ben Thanh-Thu Thiem metro lines, and the Ben Thanh-Can Gio railway.

The better read

The naive take: this is just another train procurement. The better market read: Thaco is positioning as a full-spectrum rail supplier, not just a rolling-stock buyer. Phan Cong Bang, head of the Ho Chi Minh City Management Authority for Urban Railways, said raising the share of locally made components and mastering the technology are central goals. The authority has pushed to standardize technology across the whole network so lines stay compatible and operations simpler.

Thaco's footprint already spans the spine of the system. It is the lead engineering, procurement and construction contractor on the Ben Thanh-Tham Luong metro, the investor on the Ben Thanh-Thu Thiem line, and has proposed joining the Thu Thiem-Long Thanh line. Those segments together form a roughly 65-kilometer rail axis linking the city's northwestern edge to the new Long Thanh International Airport, the country's largest, which is preparing to begin operations.