Assistance Vietnam Airlines into a significant aviation organization in the region 2024
Transforming Vietnam Airline into a robust global brand with significant competitiveness necessitates not just the enterprise’s endeavors but also governmental assistance and the collective efforts of the nation.
Affirming Vietnam Airline’ leadership role
“Among the present state-owned firms, Vietnam Airline Corporation is one of the few with a decent chance of becoming a strong economic group on par with the area due to its good management capacity and vast experience competing with foreign enterprises.
As a result, the state must make adequate investments in both financial resources and legislative procedures to provide Vietnam Airline more momentum for growth,” stated Associate Professor Dr. Nguyen Van Thao, former Vice Chairman of the Central Theoretical Council.
The leader of Enterprises’ State Capital Management Committee stated that in order to become a new economic and tourism center of great stature in Asia and around the world, Vietnam Airline must make significant investments to build a strong aviation enterprise with a flight network and fleet large enough to compete with other centers in the region.
“As a state-owned enterprise, along with the national airline brand, Vietnam Airline is the right enterprise to implement the national strategy of developing Vietnam into a regional center,” according to Nguyen Ngoc Canh.
How successful has Vietnam Airlines been in its commercial operations?
During its 30-year history, Vietnam Airline has transported over 300 million people and 4.5 million tons of cargo on 1.6 million flights, earning 1.1 million billion VND in revenue and contributing more than 65,300 billion VND to the state budget.
In 1993, Vietnam Airline operated less than 20 aircraft with a revenue of more than VND 900 billion. By 2019 (prior to the Covid-19 pandemic), the airline had more than 100 new-generation contemporary aircraft with a revenue of more than VND 103,000 billion, more than 100 times higher than 30 years before.
According to a spokesperson of the Civil Aviation Authority of Vietnam, prior to the Covid-19 pandemic, Vietnam Airline’ operations were seeing stable growth, with an average increase of 5% per year in passengers and 10% in cargo.
How Vietnam Airlines Seizes Opportunities From Rapid Recovery
According to the International Air Transport Association (IATA), Vietnam ranks first among the 25 nations with the fastest rebounding domestic aviation markets in the world.
The International Air Transport Association (IATA) ranks Vietnam #1 among the 25 countries with the fastest recovering domestic aviation markets in the world. According to the Civil Aviation Authority of Vietnam, the Vietnamese aviation market will follow the Asia-Pacific region’s general recovery pattern, returning to pre-pandemic levels by the end of 2024.
Vietnam Airlines’ challenges
Due to the COVID-19 pandemic, Vietnam Airline’ financial performance indicators have not returned to a safe level and remain in a poor state with a high risk rating; this is a significant challenge for Vietnam Airline’ efforts and limits its ability to access socioeconomic resources to improve the enterprise’s financial capacity.
The difficulties left behind by these consequences will continue to be major obstacles in the context of other factors that have a significant impact on Vietnam Airline’ operations. Specifically, the size of the aircraft fleet has decreased due to engine recall orders from manufacturers, aviation fuel prices and foreign exchange rates have been high at many stages of the year, and the political, economic and war situation in some countries around the world is still unstable and has not been resolved.
National major initiatives to strengthen competitiveness of Vietnam Airline
Furthermore, Long Thanh International Airport is expected to be one of the main national projects to boost Vietnam’s competitiveness in the future.
In particular, Vietnam Airline, as the national airline and the only airline in Vietnam that meets international standards, needs to promote its leading role, taking advantage of its experience and strengths in serving the aviation industry to build and develop centers for manufacturing components, maintaining and repairing aircraft, providing flight service products, building a synchronous ecosystem… to meet the requirements of operating Long Thanh International Airport.
Vietnam Airlines must be restored to its peak performance in order to lead the Vietnamese aviation sector ecosystem.
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