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Tag: Vietnam Airlines

  • Vietnam jet fuel tax cut to continue through 2021

    Vietnam jet fuel tax cut to continue through 2021

    Lawmakers have decided to continue the 30-percent cut in environment tax on jet fuel through next year to support the aviation industry.

    It will remain at VND2,100 (9.1 U.S. cents) per liter until the end of next year before returning to VND3,000 in 2022, the National Assembly Standing Committee decided on Thursday.

    Deputies had originally approved the cut from August until the end of this year.

    The government’s loss of revenues is estimated at VND360-400 billion this year, but it expects the tax break to reduce airlines’ costs and help them recover from the crisis caused by the Covid-19 pandemic.

    Airlines have gone through major difficulties due to travel restrictions and limited international flights.

    Vietnam Airlines forecasts a loss of VND14.8 trillion this year, while for budget carrier Vietjet it is likely to be VND3 trillion.

    The aviation industry served 29.4 million passengers in the first 11 months, down 41.7 percent year-on-year, according to the General Statistics Office.

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  • Vietnam Airlines to get bailout funds after pandemic impacts

    Vietnam Airlines to get bailout funds after pandemic impacts

    The National Assembly has approved several measures to help national flag carrier Vietnam Airlines overcome the financial impacts of Covid-19.

    A parliamentary resolution passed Tuesday allows the State Bank of Vietnam to refinance and offer loan extensions no more than two times to banks that would lend Vietnam Airlines additional capital for the company to continue its operations.

    The carrier will also be allowed to sell more shares to existing shareholders to increase its charter capital in accordance with the Law on Securities, but is exempt from the condition that its business being profitable in the year prior to the offering.

    The State Capital Investment Corporation (SCIC), a state-owned holding company, will act on behalf of the government to purchase Vietnam Airlines shares.

    The NA has asked for strict inspection and auditing of the measures when they are carried out. It has also asked Vietnam Airlines to continue building its own solutions for reducing losses and taking care of its employees in the context of the pandemic continuing to develop in complicated ways.

    Vietnam Airlines has sent 14 reports to relevant state agencies and met with government representatives several times, seeking assistance in tackling financial problems posed by the pandemic.

    The carrier has suggested the government grants it a relief package of VND12 trillion ($518.53 million), including options for refinancing and raising its charter capital.

    It reported a loss of VND10.75 trillion ($464 million) for January-September, during which its revenues fell 58.3 percent year on year to VND23.9 trillion.

    It transported 10.2 million passengers during the nine months, down 41.2 percent year-on-year.

    The airline has blamed its plight on the pandemic’s impacts. It has cut sales, financial and management expenses, reduced salaries of pilots and flight attendants. It has also increased operations of repatriation flights.

    The carrier’s third-quarter revenues fell 68 percent year-on-year after the second Covid-19 outbreak hit the country late July. The third quarter is usually the highest revenue earner of the year as schools close and summer travel peaks. The second outbreak forced the carrier to cancel 22 new domestic routes during the peak period.

    Vietnam Airlines currently operates more than 60 domestic routes with an average of 300 flights per day. It has resumed one-way flights to Japan and plans to reopen routes soon to mainland China, Taiwan, Laos and Cambodia.

    The airline has estimated this year’s total loss at around VND15.2 trillion on revenues of VND55.7 trillion.

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  • Vietnam Airlines losses soar as Covid-19 grounds flights

    Vietnam Airlines losses soar as Covid-19 grounds flights

    Vietnam Airlines has reported losses of VND10.7 trillion ($464 million) in January-September, hit hard by Covid-19. The national flag carrier recorded revenues of VND23.9 trillion in the first nine months of this year, down 58.3 percent year-on-year, it said in a press release on Tuesday.

    During this period, the carrier transported 10.2 million passengers, down 41.2 percent from a year ago.

    The airline has blamed its loss on the pandemic’s impacts on the aviation industry. It said it has cut sales, financial and management expenses, reduced salaries of pilots and flight attendants as well as increased the operation of repatriation flights as part of efforts to reduce costs and boost incomes.

    The carrier’s third-quarter revenues fell 68 percent year-on-year after the second Covid-19 outbreak hit the country in late July, said Tran Thanh Hien, the airline’s chief accountant. The third quarter was usually the highest revenue earner of the year as summer travel peaked, Hien noted.

    The second outbreak forced Vietnam Airlines to cancel 22 new domestic routes during the peak period. So far, it has resumed 11 of these and is considering the viability of resuming the rest in the fourth quarter, always a low travel period.

    The national carrier currently operates more than 60 domestic routes with an average of 300 flights per day. It has resumed one-way flights to Japan and plans to reopen routes soon to mainland China, Taiwan, Laos, and Cambodia.

    As of last month, the airline said its cash reserves had gone down to just VND1.9 trillion.

    The airline has estimated this year’s total loss at around VND15.2 trillion on revenues of VND55.7 trillion.

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  • 2nd airport proposed for Hanoi as air travel boom looms

    2nd airport proposed for Hanoi as air travel boom looms

    The Hanoi Department of Planning and Architecture has recommended the construction of a second airport in the city to cope with the rising demand for air travel. The new airport should be built in the southern district of Ung Hoa, 40 kilometers from the downtown, while the existing Noi Bai International Airport should be upgraded and have its capacity doubled to 100 million passengers a year, it said.

    Ung Hoa has several advantages such as good transport links with the city center since it is served by roads, rail, and waterway, and a large area of 1,300 hectares available for the airport, it explained.

    It could become a satellite town with an industrial zone and a logistics complex in the future, it said. Consultancy Transport Engineering Design Inc (TEDI) has said the number of air passengers could reach 150 million a year in the future, and a second airport should be built starting in 2035.

    The number of passengers and cargo passing through Noi Bai Airport has been growing by 10 percent a year reaching 29 million in 2019.

    Its designed capacity is for 25 million passengers. Vietnam generally saw demand for air travel rise before the Covid-19 outbreak, with its airports handling 116 million passengers last year, up 12 percent from 2018, according to the Airports Corporation of Vietnam (ACV).

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  • Vietnam Airlines loss soars to $280 mln

    Vietnam Airlines loss soars to $280 mln

    Vietnam Airlines reported a loss of over VND4 trillion ($170 million) in the second quarter and cumulative first-half losses of over VND6.64 trillion ($286 million).

    In its consolidated financial statement for the second quarter of 2020, the carrier reported revenues of just VND6 trillion ($258.6 million), a 68 percent fall from the previous quarter.

    It blamed the decline on the Covid-19 pandemic, which had forced it to suspend all international flights and, during the social distancing period in early April, limit domestic flights.

    Significantly cutting sales, financial and management costs did not enable the airline to remain in the black. Earlier this month its CEO, Duong Tri Thanh, estimated that its full-year revenues would drop by half from last year to just VND50 trillion ($2.16 billion), and the loss would be around VND13 trillion ($560.34 million).

    The airline has asked the government for an urgent VND12 trillion ($517.24 million) bailout, claiming it would otherwise be in a very difficult situation by the end of August. It will hold its annual general meeting, which has been delayed twice due to the agenda, on August 10.

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  • Vietnam Airlines wants $500 mln government bailout

    Vietnam Airlines wants $500 mln government bailout

    Vietnam Airlines is seeking an urgent VND12 trillion ($518 million) bailout from the government as the coronavirus continues to hit its revenues. It is likely to report a loss of VND13 trillion ($561 million) this year, with revenues falling by half from last year to around VND50 trillion ($2.2 billion), CEO Duong Tri Thanh said at a meeting on Monday.

    It has stopped all regular international flights since April when it operated only four domestic flights a day on average.

    In June the number of passengers rose to 84 percent of the number a year earlier. “Since 1975 there have never been fewer flights in Vietnam’s skies,” he said, referring to the year the Vietnam War ended.

    He expected the domestic market to recover to pre-pandemic levels only by the end of 2021, and the international market a year later.

    Government advisors said at the meeting that other options to rescue the airline include issuing more shares to existing shareholders or allowing investment by sovereign fund State Capital Investment Corporation.

    One of them, Nguyen Dinh Cung, said many other governments have bailed out airlines and Vietnam should do the same.

    Thanh said Vietnam Airlines has taken up the issue of funding with All Nippon Airways, which owns an 8.6 percent stake in it, but since the Japanese carrier is also in trouble it cannot provide loans now.

    In Vietnam, the aviation industry has been among the hardest hit by the coronavirus pandemic. Airlines served 14.6 million passengers in the first six months, down 46 percent year-on-year, according to the General Statistics Office.

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  • Vietnam Airlines to operate two direct flights to US amid pandemic chaos

    Vietnam Airlines to operate two direct flights to US amid pandemic chaos

    Vietnam Airlines will operate two commercial flights from Hanoi to the U.S. in May, exclusively for U.S. nationals.

    One would leave at 9:45 a.m. on May 2 and arrive in San Francisco at 10:00 a.m. local time, and the other will depart from Hanoi at 6:20 a.m. on May 10 and land in Washington, D.C., at 1:00 p.m. local time, the U.S. embassy announced.

    The fare would depend on the number of passengers and could be higher than a normal one-way ticket, it said, calling for citizens who need departure assistance to register with the embassy by Tuesday afternoon.

    Vietnam has suspended all international flights as a containment measure against Covid-19 and thousands of foreigners are stuck in the country.

    Some special flights have been operated in recent weeks to repatriate Europeans and citizens of several Southeast Asian countries.

    The U.S. Federal Aviation Administration issued a Category 1 rating to the Civil Aviation Authority of Vietnam under its International Aviation Safety Assessment program in 2019, meaning it met safety standards to operate flights to the U.S.

    Vietnam has emerged as a favorite travel destination for Americans.

    The United States Tour Operators Association had said Vietnam was one of the hottest destinations for U.S. travelers in 2019, with 746,171 of them visiting, an increase of 10.8 percent from 2018.

  • Vietnam Airlines loses up to $10.8 million a week to Covid-19

    Vietnam Airlines loses up to $10.8 million a week to Covid-19

    Vietnam Airlines has lost VND200-250 billion ($8.6-10.8 million) per week following flight suspension to China, the national carrier said in a statement.

    Vietnam Airlines has suspended all flights to and from mainland China since the end of January, directly affecting 70,000 visitors per month between both countries while air routes to China account for 10 percent of Vietnam Airlines’ market share, the airline said.

    “The epidemic has significantly reduced the demand for domestic and international travel among Vietnamese passengers,” the airline reported, adding the number of passengers on its domestic routes had fallen by 20-30 percent over the past two weeks.

    Vietnam welcomed around 5.8 million Chinese tourists last year, accounting for one-third of the 18 million foreign visitors to the country.

    The Civil Aviation Authority of Vietnam said Wednesday the deadly virus had cost Vietnamese airlines over VND10 trillion ($430.5 million) in revenue so far.

    Vietnam declared the Covid-19 outbreak an epidemic on February 1. The country has recorded 16 cases of infection with 11 in Vinh Phuc. Of the remaining five, three were found in Ho Chi Minh City, one in Khanh Hoa and another in Thanh Hoa.

    As of Friday the global death toll had climbed to 1,383 and confirmed infections topped 64,434.

  • Vietnam Airlines, Jetstar Pacific cut China flights

    Vietnam Airlines, Jetstar Pacific cut China flights

    Vietnam Airlines and Jetstar Pacific will stop flights on some routes to China and reduce them on others amidst the ongoing coronavirus outbreak.

    National flag carrier Vietnam Airlines will suspend routes between Vietnamese localities and China’s Beijing, Shanghai, Guangzhou and Shenzhen cities starting February 4. It will stop flying to and from China’s Chengdu starting February 5, and Macau starting February 6.

    The airline will also suspend flights on the Hanoi-Hong Kong route from February 6 and reduce the number of flights between Ho Chi Minh City and Hong Kong from 10 to 7 per week starting the same day.

    It will disinfect all aircraft upon returning to Vietnam from China to prevent the spread of 2019-nCoV, which originated in Wuhan City of Hubei Province in mainland China.

    Jetstar Pacific, the budget carrier of Vietnam Airlines, will stop operating flights on the Hanoi-Hong Kong route starting February 6, Hanoi-Guangzhou starting February 9 and HCMC- Guangzhou starting February 11.

    Passengers who wish to fly between the mentioned destinations before the suspension can change dates free of charge or ask for a refund from both airlines.

    Budget carrier Vietjet had earlier announced that it will suspend all China flights starting Saturday.

    Over 30 airlines in the world have suspended all or certain flights to China in the wake of nCoV, which as of Saturday had killed 259 people in the country.

    As of Friday, Vietnam had quarantined 97 people, of whom 32 remain isolated pending test results, according to the Ministry of Health.

    As of Saturday morning, the country has recorded six confirmed cases of infection: two Chinese nationals, and four Vietnamese, including three returning from Wuhan, and a female hotel receptionist who has caught the coronavirus infection from the two Chinese nationals presently quarantined in Saigon.

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  • Vietjet Announces Five New Routes to Japan and Commences Two New International Routes from Can Tho

    Vietjet Announces Five New Routes to Japan and Commences Two New International Routes from Can Tho

    Vietjet has unveiled a total of seven new routes, further expanding its international flight network. This includes the announcement of five new routes linking Hanoi, Da Nang and Ho Chi Minh City to multiple destinations in Japan, and the commencement of two new routes connecting Can Tho with Seoul and Taipei.

    The announcement of the launch of five new routes between Vietnam and Japan took place at Furama Resort’s International Convention Palace in Central Vietnam on 13 January 2020, where Vietjet took part as a member of the Keidanren (Federation of Economic Organisations in Japan). The announcement ceremony during the Japan – Vietnam Bilateral Tourism Promotion Conference, which welcomed more than 1,000 delegates from Japan, including officials from Japan’s National Assembly, the Japanese government and leaders from major Japanese corporations. Vietnam’s Deputy Prime Minister, Vuong Dinh Hue, and the Secretary-General of the Liberal Democratic Party of Japan cum President of the Japanese-Vietnamese Parliamentary Alliance, Nikai Toshihiro, were among those that attended the ceremony.

    The five new routes, Hanoi – Nagoya, Ho Chi Minh City – Nagoya, Da Nang – Nagoya, Hanoi – Fukuoka and Hanoi – Kagoshima, are expected to commence operations in 2020. With a total of ten direct routes now connecting Hanoi, Ho Chi Minh City and Da Nang to Tokyo, Osaka, Nagoya, Fukuoka and Kagoshima, the new flights will continue to facilitate positive bilateral relations between Vietnam and Japan culturally and economically while contributing to Vietnam’s goal of attracting one million Japanese tourists in 2020.

    Vietjet has also inaugurated its first two international services connecting Can Tho, the hub city of the Mekong Delta region, with Taipei and Seoul. Attending the launch ceremony on the morning of 12 January 2020 at Can Tho International Airport were President of the Vietnam Fatherland Front Central Committee Tran Thanh Man, Chairman of People’s Committee of Can Tho City Le Quang Manh, Vietjet Managing Director Luu Duc Khanh, Vietjet Vice President Do Xuan Quang and other leaders from related Ministries, Departments and Authorities. During the event, Vietjet also donated to the Fund for the less fortunate of Can Tho City to usher in the Tet season for the less privileged.

    The Can Tho – Taipei route operates four return flights per week starting from 10 January 2020. The flight departs from Can Tho at 12.40 pm and arrives in Taipei at 5.10 pm. The return flight takes off from Taipei at 6.10 pm and lands in Can Tho at 8.55 pm. All in local times.

    The Can Tho – Seoul (Incheon) route will operate three return flights per week starting from 16 January 2020. The flight departs from Can Tho at 4.50 pm and arrives in Seoul (Incheon) at 11.55 pm. The return flight takes off from Seoul (Incheon) at 2.30 am and lands in Can Tho at 6.20 am. All in local times.

    Vietjet currently operates the greatest number of routes and flights to Can Tho International Airport, with seven domestic routes and two international routes. Since the first flight that commenced in 2014, Vietjet has contributed significantly to the transformation of Can Tho’s tourism industry with an average growth rate of 30 percent of the total number of tourists in the city each year.

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  • Vietnam Airlines wants caps removed on domestic ticket prices

    Vietnam Airlines wants caps removed on domestic ticket prices

    National flag carrier Vietnam Airlines has proposed that price caps on domestic air tickets be removed to allow carriers more pricing flexibility.

    The current price ceiling makes it difficult for airlines to diversify their prices, increase profits during certain periods of time like peak seasons, and in turn, lower prices on some routes, Le Hong Ha, Deputy General Director of Vietnam Airlines, said at a tourism forum on Monday.

    Vietnam should abolish the domestic price ceiling, and allow market forces to decide prices. “The aviation market is already operating like a free market, so airlines should be allowed to freely adjust prices based on supply and demand,” Ha said.

    The Civil Aviation Authority of Vietnam (CAAV) supports the proposal, as Vietnam is one of the few countries in the world still have a price cap, said Vo Huy Cuong, deputy head of the authority.

    The CAAV has proposed the removal of the price cap every time amendments or supplements are made to the Civil Aviation Law, but these were not approved because the National Assembly felt it was necessary to protect the interest of many classes of civilians traveling by air, he said.

    If this regulation is not amended, airlines will focus on operating and developing international routes rather than domestic ones, he added.

    In mid-2018, many airlines requested the government to raise domestic price caps because they were losing money on many routes after cost of fuel and labor increased, but this was not approved either.

    Currently, air tickets on routes under 500 km operated to promote socio-economic development have a maximum price of VND1.6 million ($69), ordinary routes under 500 km VND2.2 million ($95), while the highest ceiling is VND3.75 million ($162) for routes of 1,280 km or above.

    According to the government portal, the air distance between the northernmost point of Vietnam to the southernmost point is 1,650 km.

    Local airlines served 50.3 million passengers from January to November, up 10.7 percent year-on-year, according to the General Statistics Office.

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  • Vietnam Airlines asked to spell out details of plan to buy 50 jets

    Vietnam Airlines asked to spell out details of plan to buy 50 jets

    The Ministry of Transport has asked Vietnam Airlines for details about its plan to acquire 50 narrow-body aircraft by 2025.

    The national flag wants to buy 50 Airbus A3210/321 or Boeing 737 MAX 8/9/10 aircraft in 2021-2025 at a cost of VND88.13 trillion ($3.83 billion).

    It seeks to replace its 26 existing aircraft and expand the fleet by 24, with four or five airplanes delivered every year.

    But the ministry said the airline needs to furnish information about the routes it plans to use the new aircraft on and detailed plans about hiring more staff to operate them.

    It warned against the purchase of Boeing 737 MAX 8 saying it is still unclear whether the grounding of the model would be reversed.

    The carrier also needs to consider that technical issues have been reported in some Pratt Whitney engines used in Airbus A320/321 NEO by some airlines, the ministry said.

    Vietnam’s surging travel demand has caused airlines to expand their fleets. Bamboo Airways has inked a deal with Airbus to buy 50 aircraft, while Vietjet last month signed a $140 million loan with foreign banks to finance its Airbus order for 20 aircraft.

    Last year the country’s 21 state-run airports handled 103.5 million passengers, according to the Airports Corporation of Vietnam, and the number is set to rise to 112 million this year.

  • Vietnam Airlines Jan-Sept profit highest in five years

    Vietnam Airlines Jan-Sept profit highest in five years

    Vietnam Airlines Group posted pretax profits of VND3.29 trillion ($142 million) in Jan-Sept, up 35.7 percent year-on-year.

    This is the highest profit it has earned in the last five years. The group, comprising Vietnam Airlines, Jetstar Pacific and Vietnam Air Services Company (VASCO), saw its net revenue rise 3 percent to VND76.7 trillion ($3.3 billion).

    The group managed to reduce sales and financial costs down by 30 percent in Q3, resulting in this quarter’s profit surging 2.5 times year-on-year to VND1.13 trillion ($48.88 million).

    The group, accounting for 51.7 percent of Vietnam’s aviation market, served 21.4 million passengers in nine months, up 3.2 percent year-on-year.

    Vietnam Airlines this year has received two new wide-body Boeing 787-10 aircraft and 10 Airbus A321neo jets. It is set to get one more Boeing 787-10 and four more Airbus A321neos by the end of the year.

    The group targets serving 23.4 million passengers this year, earning revenues of VND104.59 trillion ($4.52 billion).

  • Vietnam Airlines to launch inflight Wi-Fi service

    Vietnam Airlines to launch inflight Wi-Fi service

    Vietnam Airlines will launch inflight Wi-Fi service on some flights connecting Hanoi and HCMC with cities in China, Japan and Singapore.

    Passengers will be charged VND75,000-735,000 ($2.95 -$29.95) depending on usage time and capacity.

    Providing inflight Wi-Fi service is one of the steps that Vietnam Airlines is taking towards becoming a digital airlines by 2020 and an international five-star airline in the future.

    The Wi-Fi service will be available on the domestic route from Hanoi to Ho Chi Minh City and international flights from Hanoi to China’s Shanghai and Japan’s Osaka and between HCMC and Osaka and Singapore, the airline said in a statement Monday.

    In the coming months, the airline will continue upgrading and expanding this service to Boeing 787 and other Airbus A350 aircraft with faster speeds, it said.

    Le Hong Ha, deputy general director of Vietnam Airlines, said that when using the service, passengers can send text messages on popular applications such as Viber, iMessage, Messenger and Whatsapp.

    “This is part of Vietnam Airlines’ efforts to catch up with the development trends of the world aviation industry, with many 5-star airlines like Singapore Airlines, Qatar Airways, Cathay Pacific Airways and Lufthansa providing similar services,” Ha said.

    Vietnam Airlines operates flights on 60 international and 33 domestic routes.

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  • Vietnam Airlines cleared to fly to the US

    Vietnam Airlines cleared to fly to the US

    Vietnam Airlines has been allowed to operate direct flights from Hanoi and Saigon to several American destinations. It is the first Vietnamese airline to receive such permission, according to FlightGlobal, a leading news site about the global aviation community.

    The national flag carrier will be allowed to operate flights from Ho Chi Minh City and Hanoi, Vietnam’s two biggest metropolises, to Los Angeles, San Francisco, New York, Seattle and Dallas-Fort Worth. It can also continue these routes to the Canadian cities of Vancouver, Montreal and Toronto.

    The permit also allows Vietnam Airlines to operate its flights to the U.S. via stops in Taiwan’s Taipei and Japan’s Osaka and Nagoya airports.

    The U.S. Federal Aviation Administration (FAA) granted a Category 1 rating to the Civil Aviation Authority of Vietnam (CAAV) under its International Aviation Safety Assessment program last February, which meant the latter met safety standards to operate flights to the U.S.

    Besides Vietnam Airlines, low-cost air carrier Vietjet Air and Bamboo Airways are in the running to launch direct flights to the U.S. and are ordering aircraft for the purpose.

    There are currently no nonstop flights between Vietnam and the U.S. Flights now take 20.5 hours to fly from Ho Chi Minh City to San Francisco via South Korea’s Incheon International Airport, while the planned direct service to major cities along the U.S. West Coast would take only around 13 hours.

    Thanks to simplified visa requirements, Vietnam has emerged among the fastest-growing international travel destinations for Americans, who are big spenders in the country, shelling out on average $3,233 per trip, according to a survey released last year by travel insurance comparison site Squaremouth.

    Americans are among the top foreign visitors to Vietnam, with 687,226 arrivals last year, an 11 percent year-on-year increase.

    An ethnic Vietnamese population of over 2.1 million in the U.S. is also expected to be a steady source of travel demand.

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