VN Airlines eyes short flights

National flag carrier Vietnam Airlines is planning to launch more domestic flights by forming ties with cities and provinces nationwide.
According to deputy head of the Civil Aviation Administration of Viet Nam Lai Xuan Thanh, Vietnam Airlines has successively opened new flights from Ha Noi, HCM City and Da Nang to provinces nationwide since 2009.
The carrier recently announced the launch of Ha Noi-Vinh (Nghe An central province) and Ha Noi-Chu Lai (Quang Nam central province) flights from May 12 and June 2, respectively, this year, bringing the carrier’s total domestic air routes to 31.
The move would not only help the carrier take advantage of the domestic aviation market, but also pave the way for cities and provinces to attract investment, said Thanh.
Nghe An People’s Committee’s Phan Dinh Trac agreed, saying many investors were reluctant to invest in the central province, despite the fact it’s the home of many industrial zones.
He said he believed that once the new route opened it would be convenient not only for business, officials and people but would also unfold new opportunities for the province to attract more investment from outside.
Vietnam Airlines general director Pham Ngoc Minh cited a finding by international aviation units as saying investors do not like to spend more than four hours in their cars.
"Short flights are still essential," Minh said.
Asked if there would be competition from trains and cars, Minh insisted passengers wishing to make the journey would still be interested.
He gave the example of the HCMC-Can Tho air route launched in March this year that operates at 90 per cent capacity at present.
Joint effort
Some of the new routes have proved a challenge for the airline. It first launched the Ha Noi-Vinh service in 1995 but had to suspend operations two years later because it was operating at a loss.
This time, the carrier has entered into joint ventures with provinces to open new routes.
However, according to Thanh, provinces are not allowed to directly invest in the flights but instead call upon enterprises to contribute funds to the airline.
Nghe An Province, for instance, has convinced local enterprises to contribute VND3 billion (US$158,000) to Vietnam Airlines. Similarly, Quang Nam and Quang Ngai provinces have also pledged to contribute between VND2.5 billion ($132,000) and VND3 billion ($158,000) to the carrier to operate short flights to their provinces.
Quang Ngai provincial Party Committee Secretary Nguyen Hoa Binh said the province would also open a bus route to serve passengers travelling from Chu Lai Airport to Quang Ngai Province and vice versa free of charge.
He said the province would also pay for provincial officials to fly to Ha Noi for work.
Minh said opening a new route would mean an average loss of about VND10 billion ($526,000) so Vietnam Airlines would use the money contributed by enterprises on advertising.
"The carrier would be able to operate these flights independently after just a few years of support from enterprises," Minh said.