AirAsia to begin operations in Vietnam in August

22.02.2019

VietNamNet Bridge – AirAsia has announced it will officially take off in early August in Vietnam.

AirAsia’s representative told the local press that the carrier does not aim to scramble for aviation market share, but will build up a new market with air routes it plans to open such as Kuala Lumpur – Da Nang, Kuala Lumpur – Phu Quoc, Bangkok – Da Nang and Chiang Mai – Da Nang.

AirAsia, the biggest low-cost air carrier in  Southeast Asia, and Thien Minh Group, with its subsidiary Hai Au Aviation JSC (HAA), are expected to officially submit the application for air transport service licenses in Vietnam.

AirAsia is facing ‘reverse wind’ because of the fuel price increase and overloading. All  of its non-Malaysia branches reported losses in the last third quarter, while the financial costs have increased. Raymond Yap from CIMB Research said this is the beginning of a difficult period.

The Vietnamese market is expected to create a new springboard for AirAsia, like Thailand did in the past.

 

As the Thai market is on the decline, and Cambodia, Myanmar and the Philippines do not have much power for growth, Vietnam has great potential.

“AirAsia must come to Vietnam if it wants to be an ASEAN airline,” said Tony Fernandes at the 2018 Vietnam Tourism Forum.

The largest low-cost carrier in Southeast Asia began eyeing Vietnam in 2005, when it realized the great potential of the market. At that time, AirAsia wanted to team up with Jetstar Pacific to set up a joint venture. However, the plan failed.

Later, AirAsia made another two attempts to penetrate the Vietnamese market in 2007 and 2010, but also failed because of the barriers in the laws.

Dien Dan Doanh Nghiep quoted its sources as reporting that AirAsia may choose Can Tho Airport for its base.

If so, Can Tho would be the eighth airport in Vietnam serving international air routes, once Air Asia provides international flights with departure points in Bangkok and Kuala Lumpur.

The great potential in tourism development of Can Tho and the tendency of allocating international flights to secondary airports are behind AirAsia’s decision.

Can Tho authorities now want to attract international flights as part of the overall tourism development strategy.

A report says that Vietjet, with 43 percent of market share, and Vietnam Airlines, with 42 percent in 2017, are the biggest market share holders.

Most recently, Vietravel, one of the biggest travel firms in Vietnam, has plans to establish an airline.

 

Source: Vietnam.net

Photo: Air Asia