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Pacific Airlines faces closure due to financial difficulties

The Civil Aviation Authority of Vietnam has just asked Pacific Airlines to report on their current capital condition, and whether they meet the requirements to continue operations.


Pacific Airlines faces closure due to financial difficulties. Illustrative photo

In a notice sent to the airline, CAAV warned that if Pacific Airlines failed to maintain the required minimum capital for three consecutive years, their operational license would be revoked.

As regulated in Decree 89, an airline with a fleet of between 11-30 aircraft should have minimum capital of VND 600 billion. However, Pacific Airlines hadn't met this requirement between 2020-21. The airline even had negative equity by VND2.27 trillion and VND 4.58 trillion in 2020 and 2021 respectively.

Low-cost operator Pacific Airlines is a subsidiary of the national flag carrier Vietnam Airlines Vietnam. Formerly known as Jetstar Pacific, it restored its original brand in 2020 after Qantas sold its 30 percent stake.

Vietnam Airlines shared at a recent shareholder meeting that as of June 2022, they were facing a serious financial crisis due to cash shortfall and large overdue debts that posed the possibility of insolvency and the termination of operations.

Source: Dtinews

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