Vietnamese carriers to recover faster than ASEAN peers: report

By Dat Nguyen   October 4, 2020 | 12:21 am PT
Vietnamese carriers to recover faster than ASEAN peers: report
A Vietnam Airlines aircraft prepares to land at Tan Son Nhat International Airport in Ho Chi Minh City. Photo by Shutterstock/By Huy Thoai.
Passenger traffic for Vietnamese carriers should rebound faster than in other Southeast Asian markets, thanks to the low Covid-19 incidence in the country, a report says.

The report by Fitch Ratings estimates that the average revenue passenger kilometers (RPK) of Vietnamese airlines this year will reach 55 percent of last year’s figure.

RPK is an airline industry metric that shows the number of kilometers traveled by paying passengers. The RPK of Vietnamese airlines was 77.9 billion last year, up more than 11 percent year-on-year, according to the General Statistics Office.

The ratio of 55 percent forecast for Vietnamese carriers this year is higher than the 35 percent estimated for most airlines in other ASEAN countries like Indonesia, the Philippines, Thailand and Malaysia.

The report also forecasts that by 2021, Vietnamese carriers will record an average RPK of 90 percent of 2019, compared to 60 percent for the aforementioned ASEAN countries, showing that the former will stage faster recoveries from pandemic impacts.

Singapore Airlines might record the lowest comparative figures among ASEAN members at 30 percent and 50 percent of 2019 in 2020 and 2021, respectively, the report says.

In Asia, China could be the fastest recovering market, thanks to its success in containing the pandemic. Chinese carriers could reach 60 percent and 100 percent of 2019 levels in 2020 and 2021, respectively.

The corresponding ratio for carriers in India is pegged at 35 and 60 percent.

The report says these forecasts are based on the assumption that a vaccine or treatment will not become available at scale in 2021, but that progress is made in controlling the pandemic.

Vietnamese carriers resumed most their domestic routes and several international routes by the end of last month.

National flag carrier Vietnam Airlines is operating nearly 200 domestic flights a day on average. It has also resumed flying to Japan and plans to reopen routes soon to mainland China, Taiwan, Laos and Cambodia.

Budget airline Vietjet is operating nearly 160 domestic flights a day and has also resumed flights to South Korea.

Bamboo Airways has resumed flights to Taiwan and South Korea and plans to open routes to Japan, Singapore and Australia later this year.

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