VN Air plans to scale down fleet expansion amid low travel demand

VietNamNet Bridge – Vietnam Airlines plans to expand its aircraft fleet to 120 in 2020 instead of 150 as envisaged in a Government-approved development strategy, as demand for air travel is lower than forecast.

Vietnam Airlines, air travel, aviation industry, domestic flights

A Vietnam Airlines sits at Noi Bai airport. The airline plans to scale down its aircraft fleet expansion to 20 in 2020 instead of 150 due to lower demand for air travel than forecast – Photo: SGT

At a meeting with the Ministry of Transport on Monday, the national flag carrier mentioned the downward adjustment of the fleet expansion target stated in the development strategy approved by the Government in Decision No. 1567 in 2008.

Under the strategy, the airline would have 101 aircraft of various types in 2015 and 150 in 2020. However, as the demand for air travel in the 2011-2014 period did not grow as strongly as projected, the airline would need to review and adjust the strategy.

The carrier plans to adjust down the number of wide-body jetliners configured 280 to 300 seats by 31 and 70-seat aircraft by 11 but increase the number of aircraft with 150 to 180 seats by 12.

Vietnam Airlines wants to operate a fleet of energy-saving and environmentally friendly aircraft which help it meet technical safety standards and provide better services for passengers.

A source from the ministry confirmed the aircraft expansion plan would be reviewed before it is submitted to the ministry for approval.

In the first nine months of this year, Vietnam Airlines posted total revenue of VND52.5 trillion (US$2.35 billion) and pre-tax profit of over VND1.3 trillion (US$58.1 million), higher than targeted.

The airline credited the good business results to positive growth in the aviation industry in the January-September period thanks to the stable economic growth in Vietnam and tourism promotion programs launched from mid-2015. The visa exemption for citizens of five European countries from July has helped attract more foreign visitors to Vietnam.

However, the airline said it had to cope with a host of challenges stemming from the volatile exchange rates between the U.S. dollar and currencies used in the markets where it is present such as the euro, Japanese yen, Korean won and Australian dollar.

From January to September, Vietnam Airlines transported more than 12.5 million passengers on nearly 100,000 flights, up 5% over the same period last year.

The carrier saw growth in the number of passengers on its international and domestic flights, particularly those connecting Vietnam to the northeast Asian region as well as domestic flights to key cities and tourist areas.

From now to early 2019, the airline will develop a new aircraft fleet comprising 33 purchased and leased wide-body aircraft including 19 Boeing B787-9s and 14 Airbus A350-900s.

Earlier this year, Vietnam Airlines took delivery of one Airbus A350-900 and one Boeing 787-9 Dreamliner. The airline reported an average business-class seating occupancy rate of 85% for its HCMC-London service using Boeing 787-9.

Vietnam Airlines will take delivery of more Airbus A350-900 and Boeing 787-9 aircraft from November and improve service quality so as to transport 16.7 million passengers this year.


Vietnam Airlines, air travel, aviation industry, domestic flights