Private airlines continue to struggle in domestic market

Private airlines in Vietnam are not strong enough to heat up the domestic aviation market even though their presence is needed, an industry official says.
Vo Huy Cuong, head of the Civil Aviation Administration’s Air Transport Department, said the administration and the Ministry of Transport always want to have more companies in the airline market to make it more competitive.
“However, it seems like private carriers have limited capabilities in terms of finance and management,” Cuong said.
“It went well when they first stared their operations, but losses piled up and led to bankruptcy,” he said.
Private carriers have in fact failed to make their presence felt.
VietJet Air, the first private airline to be licensed in Vietnam, was expected to start flying in August but it has delayed the plan.
The carrier, which sold a 30 percent stake to Malaysia’s low cost carrier AirAsia, has not announced any plan to reschedule its maiden flight.
Indochina Airlines, which was the first private carrier to run flights in Vietnam, suspended its services early this year due to debt problems.
Cuong said the aviation administration had ordered Indochina to settle all the debts with its creditors by mid October but the company has not reported on the issue yet.
Meanwhile, newcomer Air Mekong has received a lot of complaints from passengers and ticket agents after calling off its flights.
Air Mekong was approved to operate 21 flights from Hanoi and Ho Chi Minh City to Da Nang between October 30 and November 16, and some 200 tickets for these flights had been sold, Cuong said.
But Air Mekong unexpectedly postponed the flights until November 16, he said, noting that as of Tuesday the carrier did not report the decision to the aviation administration.