China's CRRC signals support for Hanoi rail industrial complex as Vietnam pushes localization

China's CRRC Dalian Locomotive and Rolling Stock has expressed interest in deepening cooperation with Vietnam’s rail sector, including potential local manufacturing and technology transfer, as Hanoi moves ahead with plans to build a large-scale rail industrial complex aimed at reducing reliance on imported rolling stock.

At a meeting with Hanoi Chairman Vu Dai Thang on Thursday, CRRC Dalian general director Gao Zhongde said the company had been designated by parent group CRRC and the Chinese government as the lead rolling-stock supplier for the Lao Cai-Hanoi-Hai Phong railway, as well as two planned cross-border rail links between China and Vietnam.

Gao said CRRC Dalian is working with Vietnamese partners on preparations for a rail industrial complex in Hanoi and is closely monitoring the capital’s urban railway projects, adding that cooperation so far had progressed smoothly.

Looking ahead, the Chinese manufacturer proposed expanding exchanges with Vietnamese authorities and domestic companies to share experience and promote localization strategies for both national and urban rail systems.

Thang urged CRRC Dalian to support Vietnam in developing unified railway standards and called on the company to accelerate local production in Hanoi, alongside higher localization rates and deeper technology transfer.

The talks come as Vietnam seeks to rebuild domestic rail manufacturing capacity amid a sharp rise in long-term demand. Earlier this month, Vietnam Railways (VNR) submitted a proposal to the Prime Minister for a rail industrial complex covering about 250 hectares in Ung Hoa district, on the outskirts of Hanoi, with preliminary investment estimated at more than VND17.5 trillion ($674.37 million).

Under the proposal, the complex would comprise 25 functional zones, including assembly lines, maintenance facilities, and component manufacturing, spanning Chuyen My and Ung Hoa communes.

VNR estimates Vietnam’s total demand for locomotives and rolling stock could reach nearly 16,800 units by 2050, with the production and assembly market valued at around VND251 trillion ($9.67 billion). Demand for electric multiple unit (EMU) trainsets for the planned North-South high-speed railway alone is projected at 125 trainsets, worth about VND137.5 trillion ($5.3 billion), while urban rail cars could add a further VND7.2 trillion ($277.46 million).

The state-owned operator has described the current condition of Vietnam’s rail fleet as “alarming”, noting that the network is operating 258 locomotives and thousands of carriages, many of which have been in service for more than 40 years, raising safety and obsolescence concerns.

If approved and funded by the government, VNR said it would launch the project this year. Preparatory and legal procedures are expected to take nine to 12 months, followed by infrastructure construction and equipment installation, with the aim of bringing the complex into operation in time to support the rollout of the North-South high-speed railway.