Airlines see competition heating up in summer

Airlines are feeling the impact of increasing competition on certain air links between Vietnam and Singapore and other Southeast Asian countries in summertime, though demand for air travel on these routes has jumped.
Jetstar Asia, one of the region’s leading low-fared carriers, will expand its HCMC-Singapore frequency to three times daily later this month when adding a daily service, fueling fiercer fight for passengers on this route with the biggest number of flights recorded among the international routes linking Vietnam.
With the seven extra services by Jetstar Asia, the HCMC-Singapore route will continue to be the busiest route with nearly 90 weekly flights operated by the budget carrier, Tiger Airways, Vietnam Airlines, Singapore Airlines and Lion Air.
Vietnam Airlines intensified competition in mid-June when performing three more flights on the HCMC-Singapore route to raise its total frequency to 17 a week. Last month, Tiger Airways consolidated its position as a leader in operating services on this route when the Singapore-based carrier brought its frequency to 28 weekly flights between the two cities.
Competition is also turning fiercer on the Hanoi-Singapore connection after Vietnam Airlines added four flights in June to have 11 as currently. Jetstar Asia is also arousing the market as it is moving forward with its plan to extend its low fares offering to Vietnam with launch of four weekly flights between Hanoi and Singapore from mid-December this year.
Jetstar executives estimated the new services would represent a boost of 78% in the airline’s capacity between Singapore and Vietnam and a total of over 468,000 seats would be on offer between the two countries by the end of the year. Jetstar expected to operate up to 50 flights per week between Singapore and Vietnam, with almost 10,000 passengers moving between both countries each week.
The Vietnam National Administration of Tourism (VNAT) estimated more than 102,000 Singaporeans visited Vietnam in the first seven months of this year, up 10.6% on the year earlier period.
Singapore attracted more than 322,800 Vietnamese travelers in 2010, an increase of 21.6% over the previous year. Figures of the Singapore Tourism Board showed the number of Vietnamese visitors to that country in the January-May period rose by 4.4% year-on-year to over 118,700.
Despite increases in the number of passengers on the routes between Vietnam and Thailand and Malaysia, airlines are also struggling to lure bookings by regularly knocking fares, even in the peak travel summer season from mid-June till the end of August.
Malaysia Airlines is promoting Business-class fares from US$284 for booking until August 27 for a return trip between HCMC and Kuala Lumpur until March 31 next year. Other full-serviced airlines also have to sell reasonable fares as a result of more competition from the budget carrier AirAsia that is offering Mega Sale fares from as low as US55 for booking until August 8 for a single trip from HCMC to Kuala Lumpur from August 9 to November 16.
Malaysia Airlines currently has three daily flights to and from HCMC and one from Hanoi and AirAsia operates the exact numbers on the same routes. To heat up the market, Vietnam Airlines has begun a daily Hanoi-Kuala Lumpur service since mid-June besides its 14 weekly flights on the HCMC-Kuala Lumpur run.
Life has been easy for passengers to fly between Vietnam and Bangkok since last month when Vietnam Airlines doubled its Hanoi-Bangkok frequency to 14 a week while Turkish Airlines operated three more flights to make its service daily for the HCMC-Bangkok route.
Thai Airways International still retains two daily flights on each of Hanoi-Bangkok and HCMC-Bangkok routes but uses bigger aircraft for the Vietnamese market to capitalize on rising demand, particularly from Vietnam. Noticeably, these routes are also being exploited by the budget carrier Thai AirAsia and the fast growing Qatar Airways.
The HCMC office of Tourism Authority of Thailand (TAT) said the number of Vietnamese travelers to that country in the first half of this year soared 37.1% year-on-year to 244,882.