Downsizing fleet to cut losses
In a short time, Bamboo Airways has returned all wide-body aircraft flying long-haul to Europe and Australia, and stopped all regular international flights in the region. Regarding the domestic market, the airline focuses on exploiting trunk routes connecting major centers, including Hanoi - Ho Chi Minh City, Hanoi - Da Nang, Ho Chi Minh City - Da Nang; routes connecting Hanoi, Ho Chi Minh City with Hai Phong, Vinh, Hue, Da Nang, Dong Hoi, Quy Nhon, Cam Ranh, Da Lat, Thanh Hoa, Con Dao, etc.
Having expanded its domestic and international routes with 6 aircraft, Vietravel Airlines has reduced its fleet to 3 aircraft, along with reducing the size of its flight network and frequency of operating existing routes.
According to the 2023 plan of the Civil Aviation Authority of Vietnam, the total number of aircraft of airlines is 230 in the first months of the year and 250 at the end of the year. However, the number of aircraft continues to decrease. According to aircraft statistics from Planespotters, currently domestic airlines are operating about 204 aircraft. The number of aircraft can change continuously due to the time of leasing, returning aircraft, etc.
The leader of the Civil Aviation Authority of Vietnam said that after a long period of being affected by the Covid-19 pandemic, Vietnamese airlines in particular and world airlines in general have encountered many difficulties in production and business activities. For Vietnam, although the aviation market is gradually recovering, the consequences of Covid-19 (lack of aviation human resources after Covid, some countries are slow to open up...) along with newly arising issues such as the Russia-Ukraine conflict, high aviation fuel prices have caused the production and business results of Vietnamese airlines to not be as expected, with revenue not being able to cover costs.
To survive, stabilize, maintain production and business activities and seek development opportunities, Vietnamese airlines have had to implement many solutions from restructuring finances, fleets, organizational structures to business plans... in which restructuring finances, supplementing capital sources, cash flow, and cutting costs are considered the most important solutions.
Up to now, Bamboo Airways has also implemented these solutions and focused on reorganizing its operating model, restructuring its fleet by reducing its operating scale, returning unsuitable aircraft and ceasing operations on ineffective routes. According to the plan, Bamboo Airways' fleet will be reduced from 29 to 11 - 13 in the coming period. Vietravel Airlines continues to maintain a fleet of 3 aircraft and plans to increase its fleet to 5 - 7 aircraft.
The transportation industry in the end of 2023 is facing many difficulties.
"Thanks" to the help of railways and roads
Regarding the situation of serving the peak Lunar New Year, the aviation authorities said: During the peak period of the Lunar New Year of Giap Thin in 2024 (from January 25 to February 24, 2024, i.e. December 15 to January 15 of the lunar calendar), Vietnamese airlines are expected to provide approximately 5.5 million seats on domestic routes, an increase of 4% compared to the period of the Lunar New Year of Quy Mao and approximately 2.1 million seats on international routes, an increase of 36.8%. Compared to the regular winter flight schedule of 2023 - 2024, the capacity on international and domestic routes increased by 17% and 69%, respectively. With this capacity, Vietnamese airlines are expected to use 213 aircraft.
Along with solutions to ensure the transport capacity of Vietnamese airlines, the Department will also report to the Ministry of Transport to direct railway and road enterprises to increase transport capacity to meet people's travel needs during the Lunar New Year.
"In addition to continuing to implement solutions to remove difficulties in the production and business activities of airlines, the Civil Aviation Authority will deploy additional solutions to stabilize the market in the coming period, such as: Reporting to the Ministry of Transport to soon issue a price frame for passenger transport services on domestic routes; supporting and encouraging airlines to ensure transport forces and increase operating capacity through finding short-term leased aircraft, stopping aircraft leasing contracts to get back aircraft; reporting to the Ministry of Transport to propose the Government to have policies to support businesses in reducing environmental protection taxes, reducing some types of taxes and fees until the end of 2024..." - the leader of the Civil Aviation Authority added.
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