New Low Cost Airlines joined Vietnam market

Private low-cost carrier set to take off in Vietnam 

December 6, 2011  about Business

The first private airline licensed in Vietnam four years ago officially joined the market Friday, introducing itself as a low-cost carrier.

 

With its “Save more, fly more” slogan, VietJetAir aims to make air transport accessible to all Vietnamese and foreign tourists including low-income earners through affordable and flexible prices, the VietJet Aviation Joint Stock Company said in a press release.

 

Nguyen Duc Tam, the airline’s deputy general director, said the low-cost model is very popular and successful in the world.

 

Tam said several low-cost flights in Vietnam have been operating with old airplanes, so VietJet “will change what Vietnamese people think about low-cost carriers” by using brand-new Airbus A320 aircraft.

 

The new aircraft will save energy, reduce maintenance costs and avoid technical problems that can cause unexpected flight delays, he said, adding that all 180 seats will be used to maximize the efficiency.

 

“The operation of new and renowned aircraft will be the key to VietJetAir’s future success,,” the press release quoted Tam as saying.

 

Initially, VietJetAir will operate four flights per day between Ho Chi Minh City and Hanoi starting December 24. The number will be increased to 14 in early 2012, when it will also begin flights between HCMC and central Vietnam’s Da Nang.

 

The airline also plans to launch flights to other destinations in Vietnam and Southeast Asia in the middle of 2012, the release said.

 

VietJet had initially planned on an all-Vietnamese crew, but that will not be possible for the inaugural flights.

 

Tam told the press during the launching ceremony that “it’s impossible to use only Vietnamese people, especially pilots and technical experts.”

 

But he said the airline will regularly train people and increase the Vietnamese component of its crew.

 

VietJet, with a registered capital of VND600 billion (US$28.56 million), has delayed its maiden flight several times.

 

Like other private carriers in Vietnam, the airline has been struggling with certification, financial and personnel problems.

 

Five of them have been licensed in the past four years but only Air Mekong is flying, and not very smoothly.

 

Earlier this year, Malaysian low-cost airline AirAsia divested its 30 percent stake in VietJet after the companies did not reach an agreement on using the brand name.

 

They planned to name the joint venture VietJet AirAsia. But the Civil Aviation Administration of Vietnam has banned local carriers from using brands and logos of foreign airlines.

 

Tam said at the launching ceremony that VietJet was “active” despite AirAsia’s withdrawal.

 

“We have very good foreign experts who can replace AirAsia in technical support. Without AirAsia, we’re still flying,” he said.

 

The deputy director said VietJet is prepared financially for five years of operation and there have been no plans to seek foreign investment in the future.
 

Thanh Nien News