February 26, 2020 10:47

Advertisement Contact us RSS Vietnamese

Launch of new airline matches potential of the market

09:57 | 22/12/2019

VCN- While infrastructure bottlenecks have not been resolved, why is the aviation industry still granting licenses to newly established airlines? And will the aviation market still have room to expand? According to Dinh Viet Thang, Director of Vietnam Aviation Administration, the aviation market will continue to grow at approximately two digits in the next 5-10 years.

tin nhap 20191219160646 More airlines join market, create infrastructure bottlenecks
tin nhap 20191219160646 Two Vietnamese among top 25 Asian ‘Power Businesswomen’
tin nhap 20191219160646 Does the aviation sector change with the entry of a new airline?
tin nhap 20191219160646
Mr. Dinh Viet Thang.

Could you please give your opinion on the development of the aviation industry?

The fact that the aviation market of Vietnam has developed rapidly and impressively in recent years has brought a lot of new points, contributing to the economy and society. Since 2008, after 10 years, our aviation market has increased fivefold.

The development of the aviation market in Vietnam has also greatly facilitated people to travel with good services, reasonable prices and I think according to the geographical area and our forecast with a population of nearly 100 million people, with an economic growth rate of 6-7%/year, the aviation market will continue to grow at approximately two digits in the next 5-10 years.

Recently, the aviation market hasgrown rapidly, with the emergence of a series of new airlines, so what measures has the authority taken to create a safe and sustainable development environment?

Even the concept of sustainability includes the concept of safety. Sustainability consists of the following elements: First, sustainability is development that must be within the framework of the economy, within the planning framework and within the framework of the State's policies. The second is that if the aviation market wants to be sustainable, it must develop harmoniously and evenly between the factors from synchronous transportation to infrastructure to human resources. Thirdly, the sustainable development of the aviation industry must go hand in hand with absolute assurance on security and safety. Fourthly, in order to sustainably develop the aviation market, the state must proactively anticipate the development and introduce management policies and measures to ensure the aviation market develops in a sustainable manner and particularly ensure healthy competition between airlines.

So, in your opinion, will the "pie" of the aviation market grow bigger and the role of the state and especially the role of the Aviation Department in this matter?

To develop sustainably, it must ensure healthy competition and ensure the market meets the needs of airlines. As I said above, I am sure the aviation market will continue to thrive in the next 5-10 years and when we agree with the introduction of new airlines we also take into account. The current ability of supply and growth of airlines plus the growth of airlines in the futureisensured within the framework of the market.

Looking at the numbers, like in the US, the population is over 300 million, while the aviation market is more than 800 million passengers/year. Vietnam has 87 million people, but the aviation market has only 78 million passengers per year, we currently have 212 aircraft to serve passenger and cargo transport. It is forecast that by 2025, Vietnam's aviation market will reach about 150 - 180 million passengers. With the current growth rate, we forecast the aviation market will grow by 9-10% in the next five years. By 2025-2026, our aviation market will have about 150-160 million passengers per year. To ensure we meet this demand, we must increase the number of aircraft from more than 200 to 400 aircraft by 2025-2026. Therefore, the potential for developing the aviation market is still great. With such potential, the establishment of new airlines is an inevitable trend.

The new airlines joining, with the number of their aircraft, is also to serve the growth of the marketand also according to the Prime Minister's plan that by 2030 the fleet must reach 400 aircraft. And according to my prediction, by 2025-2026 we will have secured the Prime Minister's plan.

tin nhap 20191219160646
By 2025-2026, theaviation market will have about 150-160 million passengers per year.

It is obvious that the increase in the aircraft fleet will put pressure on Vietnam's aviation infrastructure. So how do we solve this problem, sir?

Infrastructure is a problem that we need to balance and this is also the biggest bottleneck of the aviation market today. Currently we talk about infrastructure, including our major airports.If speaking about our airport infrastructure across the country, many airports are not at full load, while many airports are also undergoingrenovation and expansion plans. The infrastructure here is mainly from the Tan Son Nhat Airport, however, the Ministry of Transport has now issued a medium-term plan to develop all 22 airports,plus Long Thanh International Airport has just been approved by the National Assembly. I hope that with the Ministry of Transport submitting to the Prime Minister to amend Decree No. 102/2015 / ND-CP on the management and operation of airports, including recommendations on mechanisms and policies, the investment procedure mechanism and the bottlenecks will be removed and we will have the opportunity to invest heavily in aviation infrastructure.

The airlines are very impatientto have favorable conditions to invest in the aviation industry, but the mechanism is still entangled. Will the amendment of Decree 102 open up competition opportunities for airlines?

Looking at the recent reality, we also have to recognize the problems related to mechanisms and policies because many of our laws mention this issue and there are regulations that are not really uniform, including the Investment Law, Construction Law, Aviation Law to Land Law, Bidding Law. We have identified these shortcomings and have made specific recommendations in revising Decree 102 to clarify these issues, creating a mechanism for coordination among sectors and localities in investing in the airport sector. Just as we will create an equal, open and transparent mechanism so that private investors can participate in investment in accordance with the policy of socialization of the state.

Thank you Sir!

By Xuan Thao/Huu Tuc