Local airports report losses

Only a handful of large airports in Vietnam are making profits, it was announced at a recent meeting between the Ministry of Transport and Vietnamese airports corporations.
Le Manh Hung, General Director of Northern Airports Corporation (NAC), said NAC made a pre-tax profit of VND336 billion (USD16.15 million) in the first eight months of the year, but only Noi Bai International Airport made substantial profits. It accounted for up to 97.7% of NAC's total revenue in the period, while, many other northern airports suffered substantial losses.
NAC said it had to spend VND64.4 billion (USD3.2 million) to offset losses accrued by airports in Quang Binh, Nghe An, Hai Phong and Dien Bien.
Five airports managed by NAC have incurred losses every year of their operation, including Dong Hoi in Quang Binh, Vinh in Nghe An, Cat Bi in Haiphong and Na San in Son La and Dien Bien.
In 2010, NAC spent VND82.3 billion (USD3.95 million) subsidising the losses, including VND58.7 billion (USD2.82 million) alone for Dong Hoi.
According to NAC, last year, it had to spend VND9.8 million (USD471.15) on average to offset losses for each flight flying from or to loss-making airports.
In January 2009, Vietnam Airlines and Jetstar Pacific opened their Hanoi-Can Tho air route after Can Tho Airport was upgraded to accept international flights.
However, Jetstar Pacific had to suspend the route just a few months later due to small passenger numbers, with the national flag carrier also reducing flight frequencies. Can Tho’s gloomy operation is echoed by many other airports in Vietnam. Only Phu Quoc in Kien Giang Province, Lien Khuong in Lam Dong Province and Buon Ma Thuot in Dak Lak Province and major city airports have remained profitable.
Vietnamese airport operators have proposed raising air service fees in order to compensate for losses as existing fees have remained unchanged for 10 years.
Meanwhile, many airports continue to operate inefficiently, despite pleas from a number of localities to have new airports in An Giang, Quang Ninh and Hai Phong.
Official says more airports still being considered
Dinh Viet Thang, Deputy Head of the Civil Aviation Administration of Vietnam (CAAV), said, under international practice, airports which serve below 5 million passengers a year often suffer from loss.
He added that airports in Vietnam are managed on a regional basis and use profits from gate-way airports to compensate local, less efficient destinations; therefore, the country’s airport sector was still profitable.
To date, Vietnam has mainly focused on upgrading old airports and the country is still considering the construction of new airports in An Giang, Thanh Hoa and Lai Chau to meet socio-economic development demands.
He added that airports have contributed to making the Vietnamese aviation sector the second fastest growing in the world.
According to Thang, under a plan approved by the Government to 2020 with a vision until 2030, Vietnam will put 26 airports into operation, including 10 capable of accepting international flights.