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Hanoi’s first metro line posts over $2.7mn loss in 2021 audited financial report

Hanoi’s first metro line posts over $2.7mn loss in 2021 audited financial report

Thursday, June 23, 2022, 11:20 GMT+7
Hanoi’s first metro line posts over $2.7mn loss in 2021 audited financial report
The Cat Linh-Ha Dong metro line operated by Hanoi Metro. Photo: Nam Tran / Tuoi Tre

Hanoi Metro, the operator of Hanoi’s Cat Linh-Ha Dong metro line, posted losses of over VND63.7 billion (US$2.7 million), inclusive of VND12.2 billion ($525,000) in corporate management costs, in 2021 since the metro line was put into service in November last year.

The firm had already been operating at a deficit given the VND22.7 billion ($976,120) loss it incurred in 2020, prior to the metro line’s inauguration.

According to its 2021 audited financial report, Hanoi Metro earned just VND5.3 billion ($228,220) from ride fares for the Cat Linh-Ha Dong metro line.

During the year, its income from financial activities jumped 133 percent from 2020 to VND2.1 billion ($90,400).

Its expenses, however, amounted to more than VND58.9 billion ($2.5 million), including VND43.7 billion ($1.88 million) in labor costs.

This loss, plus its corporate management costs of VND12.2 billion, took Hanoi Metro’s total losses for the year to VND63.7 billion in 2021.

Hanoi Metro’s total losses between June 2015 and late 2021 added up to VND160 billion ($6.8 million).

In a press released published on June 18, Hanoi Metro noted that the ticket prices for public passenger bus and metro line services are set by the capital government, while subsidies are awarded to public transport operations so that ride fares remain low and residents feel encouraged to use public transport in order to cut down on the use of private vehicles, reduce pollution, and ease traffic jams.

Upon the launch of the Cat Linh-Ha Dong metro line last year, the Hanoi People’s Council passed a resolution to offer Hanoi Metro the same incentives and subsidies it grants to public buses. 

Hanoi Metro, however, has yet to apply for these subsidies.

Had it done so, Hanoi Metro claimed, its financial situation would not appear so gloomy by now.

The firm is in the process of completing dossiers so that it can be awarded the subsidies for the metro line for the last two months of 2021 and the whole of 2022.

Established by the Hanoi government, Hanoi Metro was chartered to manage and operate the city’s urban railways in June 2015.

On November 6, 2021, the firm opened the city’s first metro line – the Cat Linh-Ha Dong elevated route.  

Statistics from the operator indicated that from November 6, 2021 to May 26, 2022, after 202 days of operation, the urban railway served over 3.1 million passengers, meaning that it transported an average of 15,600 passengers a day.

The metro line now services around 22,000 passengers per day on working days, while the daily number of passengers hits up to 30,000 on weekends.

Particularly, the number soars to over 40,000 on holidays. On May 1 alone, more than 50,000 passengers used the public means of transport.

The metro line boasts a staggering 99.98 percent punctuality rate.

Some 55-60 percent of its passengers use monthly tickets for daily trips, and 75-80 percent of the passengers show the monthly tickets during rush hour.

Construction of the 13-kilometer metro line cost VND18 trillion ($868 million).

It features 12 elevated stations and 13 trains which run from Cat Linh Station in Ba Dinh District to Yen Nghia Station in Ha Dong District.

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Hanoi Metro, the operator of Hanoi’s Cat Linh-Ha Dong metro line, posted losses of over VND63.7 billion (US$2.7 million), inclusive of VND12.2 billion ($525,000) in corporate management costs, in 2021 since the metro line was put into service in November last year.

The firm had already been operating at a deficit given the VND22.7 billion ($976,120) loss it incurred in 2020, prior to the metro line’s inauguration.

According to its 2021 audited financial report, Hanoi Metro earned just VND5.3 billion ($228,220) from ride fares for the Cat Linh-Ha Dong metro line.

During the year, its income from financial activities jumped 133 percent from 2020 to VND2.1 billion ($90,400).

Its expenses, however, amounted to more than VND58.9 billion ($2.5 million), including VND43.7 billion ($1.88 million) in labor costs.

This loss, plus its corporate management costs of VND12.2 billion, took Hanoi Metro’s total losses for the year to VND63.7 billion in 2021.

Hanoi Metro’s total losses between June 2015 and late 2021 added up to VND160 billion ($6.8 million).

In a press released published on June 18, Hanoi Metro noted that the ticket prices for public passenger bus and metro line services are set by the capital government, while subsidies are awarded to public transport operations so that ride fares remain low and residents feel encouraged to use public transport in order to cut down on the use of private vehicles, reduce pollution, and ease traffic jams.

Upon the launch of the Cat Linh-Ha Dong metro line last year, the Hanoi People’s Council passed a resolution to offer Hanoi Metro the same incentives and subsidies it grants to public buses. 

Hanoi Metro, however, has yet to apply for these subsidies.

Had it done so, Hanoi Metro claimed, its financial situation would not appear so gloomy by now.

The firm is in the process of completing dossiers so that it can be awarded the subsidies for the metro line for the last two months of 2021 and the whole of 2022.

Established by the Hanoi government, Hanoi Metro was chartered to manage and operate the city’s urban railways in June 2015.

On November 6, 2021, the firm opened the city’s first metro line – the Cat Linh-Ha Dong elevated route.  

Statistics from the operator indicated that from November 6, 2021 to May 26, 2022, after 202 days of operation, the urban railway served over 3.1 million passengers, meaning that it transported an average of 15,600 passengers a day.

The metro line now services around 22,000 passengers per day on working days, while the daily number of passengers hits up to 30,000 on weekends.

Particularly, the number soars to over 40,000 on holidays. On May 1 alone, more than 50,000 passengers used the public means of transport.

The metro line boasts a staggering 99.98 percent punctuality rate.

Some 55-60 percent of its passengers use monthly tickets for daily trips, and 75-80 percent of the passengers show the monthly tickets during rush hour.

Construction of the 13-kilometer metro line cost VND18 trillion ($868 million).

It features 12 elevated stations and 13 trains which run from Cat Linh Station in Ba Dinh District to Yen Nghia Station in Ha Dong District.

Like us on Facebook or follow us on Twitter to get the latest news about Vietnam!

Tieu Bac - Tuan Phung / Tuoi Tre News

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