Airlines compete to take over the air routes left by Air Mekong

VietNamNet Bridge – Right after Jetstar Pacific announced the opening of the HCM City – Buon Ma Thuot and the Buon Ma Thuot – Vinh City air routes in late March 2013, VietJet Air has also planned to provide the flights on the routes in the next month.


Vietnam, airlines, Vietjet Air, Air Mekong, air routes, loss

The difficulties being met by Air Mekong have brought opportunities to others. Airlines have jumped to the air routes Air Mekong once successfully exploited in the past.

These are the routes Air Mekong has left when it has to halt the operation due to the big losses.

On the press release issued on March 26, the day the new air routes were opened, Jetstar Pacific said this was the event making the hallmark for a new development stage of the air carrier which has successfully connected with the central highlands.

General Director of Jetstar Pacific said 5,000 passengers have bought low cost air tickets on both the air routes. Of these, 2,000 passengers have luckily bought tickets at very low price of VND199,000.

In the immediate time, Jetstar Pacific plans to provide 5 flights there and back a week between HCM City and Buon Ma Thuot, and 3 between Buon Ma Thuot and Vinh City.

Just two days later, on March 28, Vietjet Air kicked off the sale of the air tickets for the flights between HCM City and Buon Ma Thuot. Those lucky passengers can buy tickets at the preferential level of VND390,000.

The air carrier plans to open the air route on May 20, from which 7 flights a week in the first stage of development.

The HCM City – Buon Ma Thuot route was once developed very successfully by Air Mekong. This explains why Vietjet Air and Jetstar Pacific have decided to jump on the bandwagon to scramble for the attractive “piece of cake” as soon as Air Mekong left the market.

Meanwhile, experts have expressed their worry about the overly stiff competition among air carrier on the small domestic market. A representative of an airline has noted that while there are more service providers, the number of passengers remains unchanged.

This would force the airlines to compete fiercely with each other, while the battle would bring big difficulties to both of them.

In an effort to increase its competitiveness, Jetstar Pacific has decided to join forces with Vietnam Airlines (both Jetstar Pacific and Vietnam Airlines now exploit the air routes to Buon Ma Thuot) to implement a program allowing to change the flight schedule. Under the program, if there are some changes in the flight schedule, passengers would be allowed to shift to take the flights with Vietnam Airlines or Jetstar Pacific.

Both Jetstar Pacific and Vietjet Air are budget airlines, but they seemed to be different in business performance.

The report of the Ministry of Transport has shown bad figures about the former’s operation. In 2012, the accumulative loss of the air carrier reached VND2,476 billion.

Prior to that, the Prime Minister decided to put the airline under the management of Vietnam Airlines Corporation after the airline incurred big losses in the last many consecutive years, despite the big efforts to restructure it.

Meanwhile, Desmond Lin, a senior executive of Vietjet Air, said the airline’s turnover was higher by 20 percent than the targeted level, an encouraging result for such a fledgling airline. It hopes to begin making profit right in 2013.

NLD

Vietnam, airlines, Vietjet Air, Air Mekong, air routes, loss
 
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