VietNamNet Bridge - The competition among international air routes has become stiffer than ever before as  flight frequencies depend on the numbers of passengers airlines can obtain.

The General Statistics Office (GSO) has reported that the number of foreign travelers to Vietnam in 2014 increased by 4 percent, a very low growth rate compared with 10.6 percent in 2013. 

The increasingly high number of unoccupied seats on the France-Vietnam air route could be the reason behind Air France’s decision to stop providing direct flights between Paris and Hanoi one year ago. The air carrier buys seats at Vietnam Airlines and still maintains the Paris-HCM City route.

Vietnam Airlines, the national flag air carrier, feeling the heat of the competition, has recently applied measures to attract passengers in an effort to regain market share on both domestic and international routes.

However, analysts said it would not be easy when the State still holds 75 percent of Vietnam Airlines’ chartered capital. 

After equitization, Vietnam Airlines will still have a labor force of 10,000 workers and the existing managers. 

No one is sure if Vietnam Airlines’ competitiveness would be better after it buys more aircraft. 

Tran Bang, an aviation expert, noted that financial capability plays a very important role in the aviation industry. 

He said Vietnam Airlines must predict the market supply and demand and calculate production costs, especially airfare per seat.

Bang warned that Vietnam Airlines is now having problems in branding due to a problematic communications strategy.

While Vietnam Airlines’ flights have never had serious accidents, it has recently encountered communication risks. 

The explanations by Vietnam Airlines about a hole found on an aircraft and an accident with an airplane tyre did not ease the public’s worries about safety. 

The air carrier does not have a clear communication strategy to manage risks.

Bang said with more than 100 aircraft Vietnamese air carriers need to upgrade aircraft maintenance to higher levels from the current low level.

Vietnam Airlines and other air carriers understand what they need to do. However, they try to save expenses on maintenance because it is costly to have aircrafts and engines maintained.

Minister of Transport Dinh La Thang, when asked to comment about the opening of direct air routes, said: “Competition is a part of integration”.

According to the International Air Transport Association (IATA), Vietnam ranks seventh among the world’s fastest-growing markets with the international passenger and cargo transport proportion 6.9 and 6.6 percent, respectively, estimated in the 2013-2017 period.

DNSG