Daejeon City "Tram Construction Project Budget Confirmed... Project to Fully Launch in First Half of This Year"

The total project cost for the construction of the Daejeon Urban Railway Line 2 tram has been finalized. Tram construction is expected to be fully underway, starting with vehicle orders this month and followed by construction orders in June.

Provided by Daejeon City

On the 5th, Daejeon City announced in a municipal briefing that the Ministry of Economy and Finance had confirmed and notified the total project cost for tram construction as 1.4782 trillion KRW. The finalized total project cost is 729 billion KRW higher than the 749.2 billion KRW approved in the basic plan in 2020.

At one point, the tram construction faced uncertainty due to controversies over budget increases and delays in policy decisions regarding catenary and catenary-free systems.

However, after the launch of the 8th local government administration, the project gained momentum again by passing the Korea Development Institute (KDI)’s re-evaluation of project plan adequacy based on the basic design (total project cost 1.4091 trillion KRW), which reflected improvements in tram average speed, undergrounding of major traffic congestion sections, and a fully catenary-free implementation plan considering urban landscape.

During the KDI’s re-evaluation process, in addition to the basic design plan, the appropriateness of a 700m extension in the Yeonchuk district and the introduction of catenary-free hydrogen trams were also reviewed.

As a result, KDI judged all of Daejeon City’s requests as appropriate, including ▲some route adjustments such as passing through Daejeon Station and extending Yeonchuk district (total length from 36.6 km to 38.8 km), ▲adding 10 more stations compared to the basic plan (from 35 to 45 stations), ▲undergrounding certain sections such as Seodaejeon Overpass, Temi Hill, and Jayang Hill, and ▲introducing fully catenary-free hydrogen trams.

Additionally, by reflecting inflation (from 2021 to the fourth quarter of 2022) and other factors, the total project cost was finalized at 1.4782 trillion KRW, which is 69.1 billion KRW more than what Daejeon City requested during the re-evaluation process.

Daejeon City has concurrently completed the necessary preliminary administrative procedures for the KDI project plan adequacy re-evaluation, basic plan changes, and vehicle orders. The progress rate of the detailed design following the basic design is currently 85%, and it is expected to be completed by next month.

Daejeon Urban Railway Line 2 Tram Route Map. Provided by Daejeon City

The target for tram opening is 2028. Daejeon City plans to accelerate tram vehicle production and construction orders to ensure the tram construction is completed by the targeted time.

First, the order for catenary-free hydrogen tram vehicles will be placed this month to select a vehicle manufacturer, and tram vehicle production is expected to begin within the first half of the year. The vehicle order is expected to involve a project cost of 295 billion KRW.

Next, considering the scheduled completion of the detailed design next month and the basic plan change schedule, Daejeon City plans to carry out preliminary administrative procedures related to contracts and proceed with orders for other construction works such as civil engineering and architecture by June.

KDI anticipates economic effects from the tram construction project including production inducement of 24.521 trillion KRW, value-added inducement of 9.78 trillion KRW, and employment inducement of 16,145 people. Above all, considering the geographical location of the project, most of the economic ripple effects are expected to be concentrated in Daejeon.

Lee Jang-woo, Mayor of Daejeon, said, “Increasing the total project cost of a single project by nearly 730 billion KRW is a rare case nationwide,” and added, “Daejeon City will focus administrative efforts to speed up the delayed tram construction and meet the 2028 opening target.”