Expensive airfares damage Vietnam tourism during peak season

The drop in air travel has hit the entire tourism industry hard, including restaurants and hotels.

The Gold Coast restaurant in the central beach resort city of Nha Trang said that the number of customers from the north, who mainly arrive by air, has decreased by about 70% compared to the beginning of the summer season last year.

Now the establishment mainly welcomes customers from the central and southern regions that are more easily connected by road.

Bui Thi Huong, the restaurant’s representative, said that in previous years, when airfares were not as high as now, the restaurant was often full of tourists throughout the summer.

But now Huong is worried about the restaurant losing revenues from decreasing customers from the north.

Hoang Anh, owner of a 4-star hotel in Nha Trang, also said the number of visitors from Hanoi this summer had decreased by about 60% compared to last year.

The reason is that airfare prices are so high, customers are no longer excited to travel domestically by air, Anh said.

Since the close of the Covid pandemic, her hotel has only increased prices by about 2-3%, and tried to support travel companies.

During this peak summer season, the hotel is still filled with guests from the south and central regions thanks to convenient transportation. However, in the low season at the end of the year, she is afraid her hotel will lose a large number of MICE tourists from the north if air ticket prices show no signs of moving downward.

On Vietnam’s biggest island Phu Quoc, Doan Minh Tuan, business director of the Ngoc Hien pearl shop, also said the number of visitors from the north this summer had decreased 40-60% compared to the same period of last year.

Northern tour groups are often large, about a few dozen people, and at the very least they are a family group of four, all of which bring high revenues to business establishments, Tuan added.

Currently, round-trip airfares from Hanoi to Nha Trang during June weekends range from VND4.2 to 5.4 million for good flight hours.

According to data from Best Price's air ticket office, airfares on the Hanoi - Nha Trang route at during the same period last year cost around VND3.1 million.

Due to high airfares, travel companies have switched to new business strategies by developing more road-connected tours to help tourists save costs.

A representative from the HCMC-based Viet Media Travel Company said domestic air-connected tours this summer have accounted for only about 30% of all bookings, and the rest has mainly used road or rail transportation.

"The change can be seen most clearly in Nha Trang, which every year is chosen by a large number of groups from Hanoi, but this year that figure has decreased by about 60%," said Pham Anh Vu, marketing director of the company.

As soaring airfares continue to challenge the domestic tourism market, Vietnamese tourists have begun switching their travel plans to other Asian destinations.

Nguyen Tien Dat, CEO of Hanoi-based AZA travel company, said that since the beginning of the year, airfare price increases have prompted travel companies to rapidly replace flight-connected tour programs with domestic road or rail tours, as well as outbound tours to Thailand and China.

Dat said this scenario will continue for the remaining summer months if airfare prices remain high.