The move aims to provide improved services, according to VNR, as its outdated locomotives and carriages result in higher fuel consumption and maintenance costs.

In accordance with the 2017 Railway Law, the lifespan of locomotives and carriages should not stretch beyond 40 years for passenger trains and 45 years for goods trains.

But about a half of its locomotives and one-third of the carriages have been in use for 30-40 years, so it is now necessary to purchase replacements.

VNR worked with a foreign partner on investment solutions for its plans. The partner will build the trains and offer them to the VNR on a lease-purchase agreement.

When the agreement is completed, the trains will be the property of VNR; a method that helps reduce intermediate cost and other expenses.

The cost of building carriages will be cut by 10 per cent and investors have the responsibility for conducting maintenance. VNR expects to see 50 new trains go into operation over the next three to five years.

It will also work with its partner to form a joint venture with the Gia Lam Train Company or the Di An Train Company, to lower the cost of building trains while ensuring domestic workers, machinery, and materials are utilized.

VNR will also continue upgrading old carriages that are still in working order. VN Economic Times

Le Diem

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