return icon

Aviation sector strives to navigate COVID-19 outbreak

Airlines in Vietnam are looking at ways to overcome the impact of the COVID-19 outbreak after seeing declining passenger numbers.

Aviation sector strives to navigate COVID-19 outbreak hinh anh 1

Vietnam's aviation market has been strongly affected by the COVID-19 outbreak



Double-digit declines

The Civil Aviation Authority of Vietnam (CAAV) reported that airports in the country served nearly 8.1 million passengers in February, down 11.6 percent from the same period last year. They included 2.4 million foreigners and 5.7 million domestic passengers, down 29.8 percent and 0.7 percent, respectively

Also last month, Vietnamese airlines transported 3.7 million passengers, falling 13.7 percent year on year. The number of foreign and domestic passengers respectively decreased 39.5 percent and 0.7 percent.

The CAAV attributed the double-digit fall in the Vietnamese aviation market after many years of strong growth to the direct impact of the COVID-19 outbreak.

Vietnam Airlines said for every week of the epidemic, the national flag carrier is losing 200 – 250 billion VND (8.7 – 10.8 million USD). Its revenue from both passenger and cargo transportation dropped 20 – 25 percent in the first half of February.

According to the CAAV, China, which has recorded the biggest number of COVID-19 cases, accounts for 26.1 percent of the passenger and cargo volume that domestic carriers transport to and from international destinations.

Before the acute respiratory disease broke out, 14 airlines were operating 72 routes between Vietnam and China. The suspension of flights to China has caused Vietnamese airlines to lose 400,000 passengers per month. They have also had to pay more for ticket exchanges, cancellations, and sterilisation, the authority said.

In a report assessing the outbreak’s impact on the economy, Dr Can Van Luc and analysts from the BIDV Training and Research Institute said air transport will be hit the hardest since foreign passengers using Vietnam’s air transport services account for more than 79 percent of total international arrivals in the country. In particular, Chinese visitors arriving by air make up 70 percent of all Chinese visitors to Vietnam.

The research division at SSI Securities JSC also rated the aviation sector’s short-term outlook as “negative”, noting that all airlines could be influenced by the epidemic due to lower travel demand, especially from China. In 2019, Chinese tourists accounted for 32.2 percent of the 18 million foreign travellers to Vietnam.

Seeking solutions

Since late February, carriers like Vietnam Airlines, Vietjet Air, Jetstar Pacific and Bamboo Airways have been offering discounts on domestic and international routes.

Notably, people now can easily buy tickets for Hanoi – Ho Chi Minh City flights for only one-third of train tickets. They can also buy cheaper tickets on international routes.

Economic experts said the airlines made the move with a view to attracting passengers, stimulating travel demand and maintaining their operations.

Lai Xuan Thanh, Chairman of the Board of Directors of the Airports Corporation of Vietnam (ACV), said the ACV will need to adjust its business plan and work with airlines to seek ways to stimulate demand.

After the SARS outbreak in 2003, the aviation sector learned that overdependence on a single market had a considerable influence on airlines if that market encountered problems. Therefore, the sector has worked to restructure its markets.

Facing the COVID-19 outbreak, the ACV is also coordinating with relevant parties to carry out restructuring, Thanh added.

Vietnam Airlines has announced that it is offering its narrow-body aircraft (A321) and wide-body ones (A350-900 and B787-9/10) for lease.

Meanwhile, Vietjet Air is launching five direct routes from Da Nang, Hanoi and HCM City to India.

Airlines are working to open new domestic routes, sell tickets at lower prices to attract passengers, while ensuring their planes do not stand idle to reduce expenses, the CAAV said.

It has recommended carriers negotiate with aircraft renters to return some planes and with manufacturers to extend deadlines for receiving new planes.

Airlines have also submitted reports to the CAAV, the Ministry of Transport and the Government so that detailed plans can be made to help revive the market in late 2020 and the next two years after the outbreak is contained.

Vietnam Airlines hardest hit by Covid-19 among major state firms



Most major state-firms are facing a gloomy outlook as Covid-19 is wreaking havoc on the economy.

Flag carrier Vietnam Airlines is forecast to suffer a decline of VND12.5 trillion (US$542.51 million) in revenue and a loss of VND4.3 trillion (US$186.62 million) in profit in 2020, due to a plunge in the number of air passengers on fears of the Covid-19 epidemic, according to the Commission for Management of State Capital at Enterprises (CMSC).

This means the airline would be unable to fulfil the business plan set by CMSC, dubbed as “super committee”, for this year, CafeF reported, citing the committee’s brief report on the impacts of Covid-19 on the operations of 19 major state-owned enterprises (SOEs) under its administration.

Meanwhile, Airports Corporation of Vietnam (ACV) expected the number of passengers to decrease by over 12 million, a 10% lower than the target set for 2020.

ACV’s revenue in 2020 is estimated to reach 87% of the estimate or a decline of VND2.8 trillion (US$121.41 million), make a pre-tax profit meeting 76% of the estimate, down VND2.6 trillion (US$112.74 million).

Vietnam Railway (VNR) stopped operation of a number of railway routes due to the lack of passengers. The suspension of Vietnam – Nanning route on February 4 has significantly impacted VNR’s business performance.

VNR’s revenue in 2020 is estimated to decline by VND54.8 billion (US$2.37 million), down 13.3% year-on-year, while revenue from cargo transportation is forecast to be shaved by VND9.9 billion (US$429,377)..

According to Vietnam National Shipping Lines (Vinalines), most shipping fleets are struggling to maintain daily operation, mainly due to the disruption of logistics services for Chinese customers via maritime transportation.

In case the epidemic persists until the end of March or the second quarter, Vinalines expected its consolidated revenue to decline VND1.62 trillion (US$70.23 million) and its profit to fall short of VND534 billion (US$23.15 million) compared to the respective targets.

Petrolimex, Vietnam’s largest petroleum distributor, reported domestic sales of petroleum products in January down 4% month-on-month, while sales in February fell 20%.

Launched nearly two years ago, the CSCM is tasked with managing state capital at 19 leading state-run groups and corporations with combined capital of VND1,000 trillion (US$43.02 billion), or two-third of total state capital, and assets of over VND2,300 trillion (US$98.96 billion). VNA/Hanoitimes

Vietnam’s aviation sector loses $435 million amid Covid-19 epidemic

Vietnam’s aviation sector loses $435 million amid Covid-19 epidemic

The initial loss caused by the suspension of flights to and from China for Vietnam’s airlines could be up to VND10 trillion.

Is Vietnam’s aviation market losing its appeal?

Is Vietnam’s aviation market losing its appeal?

Air Asia has given up its plan to set up a joint venture in Vietnam, while Vingroup has canceled its Vinpearl Air project.


Downpours cause human, property losses in northern Vietnam

Hanoi and other northern provinces were inundated following heavy rains on May 23 and 24 that have caused human and property losses.

Vietnam puts forward numerous important proposals at WEF Davos 2022

Deputy Prime Minister Le Minh Khai has shared the nation’s plans to build a low-carbon, green-ecological-sustainable agriculture system with three pillars; ecological agriculture, modern countryside, and smart farmers.

Various Party members in HCM City disciplined

The Ho Chi Minh City Party Committee’s Inspection Board has disciplined seven Party members for their involvement in four cases monitored by the Central Steering Committee for Corruption and Negative Phenomena Prevention and Control.

Government proposes delay to submission of draft amended Land Law to NA

The Government has proposed a delay to a submission of the draft Law on Land (amended) to the National Assembly (NA) until the Party Central Committee issues directions on reforms of land-related policies and laws.

New records, outstanding athletes of SEA Games 31

A total of 22 new records were set at the 31st Southeast Asian Games (SEA Games 31) which concluded with a colourful ceremony in Hanoi on May 23 night.


Traffic accidents claim over 2,760 lives in five months

Obstacles yet to clear to pave way for robust industrial property development

Vietnam has not yet reached its full potential in industrial property development, due to inadequate regulations and a lack of social infrastructure.

Teen suicide: 'red warnings' ignored

According to statistics, about 2% of children suffer from depression. The rate is from 5% to 8% for adolescents. The rate is higher among children after puberty.

Prime Minister to host dialogue with farmers on May 29

Prime Minister Pham Minh Chinh will host a dialogue in Son La on May 29 with a participation of 500 delegates, including 300 typical farmers, cooperatives and enterprises in the agricultural field along with experts and scientists across the country.

Will housing prices cool down in late 2022?

The boost in sales and the slowdown of the land bank expansion are expected to help  land and house prices decrease in the remaining quarters of 2022, according to VNDirect Research.

Just 15 percent of urban wastewater treated

According to the Government's report, the total amount of wastewater collected and treated in urban areas is very low, only about 15 percent whereas wastewater in most rural residential areas is not treated.


Tight material supply impedes textile exports

Stock, real estate markets too hot, need close supervision

The Government has submitted to the National Assembly a report about the implementation of the 2021 socio-economic development plan and the deployment of the 2022 plan.

Hoi An sampan riders: the hardships and the smiles

Entering a new normal phase after more than two years of being hit hard by the COVID-19 pandemic, sampan riders in Hoi An City are eager to get back to work, expecting prosperous, stable tourism development for the town.

HCM City to host Smart City Asia 2022

A Smart City Expo & Forum in Asia (Smart City Asia 2022) will be held at the Saigon Exhibition and Convention Centre in Ho Chi Minh City from May 26 to May 28.