The deal, which builds on an existing partnership between the two companies, is meant for VinSpeed to lay tracks and operate high-speed trains between Hanoi and Ha Long ⁠and between Ben Thanh in downtown Ho Chi Minh City to the city's outlying Can Gio area, Reuters reported.

Vingroup, the flagship company of Pham Nhat Vuong, the richest man in Southeast Asia and the majority shareholder of VinSpeed, has confirmed the report and the value of the agreement.

Last year, the two companies had signed a framework agreement, under which Siemens will supply and integrate trains and key systems, including signaling, communications, and power supply, for VinSpeed's projects.

It will also coordinate technology transfers and research maintenance options during operations.

An illustration of VinSpeed high-speed train. Photo courtesy of Vingroup

Siemens Mobility is the rail and transportation business of German conglomerate Siemens. With more than 175 years of experience in the industry, the company is a core technology provider that has laid the foundation for some of the world's most advanced high-speed rail systems in countries including the U.S., Russia, and China.

VinSpeed, established in May last year, is majority owned by Vuong (51% stake). The other shareholders include Vietnam Investment Group with a 35% stake, Vingroup with 10%, and Vuong's sons Pham Nhat Quan Anh and Pham Nhat Minh Hoang each with 1%.

It has charter capital of around VND45 trillion (US$1.73 billion) and has interests in railroad construction and rolling stock manufacture.

The Ben Thanh-Can Gio line, to run 54 kilometers, and the Hanoi-Ha Long line, to run 120 kilometers, will cost VND202 trillion and begin commercial operation in 2028.