Will rent 4 planes during Tet peak

At the 2023 Annual General Meeting of Shareholders of Vietnam Airlines on December 16, there were concerns from shareholders about the news that Prat Whitney - an American company specializing in manufacturing aircraft engines - will recall about 3,000 A320Neo aircraft engines of airlines around the world in 2024 to conduct technical inspections to ensure the operational capacity of this model. It is known that many airlines in Vietnam use aircraft with this engine, so will it affect operations?

Vietnam Airlines General Director Le Hong Ha speaks.

Mr. Le Hong Ha, General Director of Vietnam Airlines, said that based on information from Prat Whitney, Vietnam Airlines has about 12 planes that have to have their engines removed for inspection, which will affect operations.

"In addition, due to the disruption of the supply chain, the repair time is prolonged. Previously, this usually took about 75-90 days, but now it will be extended to more than 200 days. Vietnam Airlines conducts time management to ensure that the engine is maintained as quickly as possible and put into operation," said Mr. Ha.

To meet the peak transportation demand during the upcoming Tet holiday, Vietnam Airlines is choosing to wet lease up to 4 aircraft during this period (wet lease means renting both the aircraft and service personnel).

At the same time, in 2024, Vietnam Airlines will continue to monitor and implement fleet planning options, which are not decided by the airline but depend on the lessor. During the year, Vietnam Airlines will receive 2 more Boeing 787-10 aircraft and 3 Airbus A350 aircraft. Vietnam Airlines will wet-lease and dry-lease aircraft and monitor actual market developments to proactively operate in 2024.

Regarding the aviation business situation in 2023, the General Director of Vietnam Airlines said that after a series of countries fully reopened, regular domestic and international flights to these countries resumed, helping the aviation industry maintain passenger transport activities and balance cash flow in the short term.

However, the recovery momentum of the air transport market was only quite strong in the first 4 months of the year and has tended to slow down in the second quarter. International air transport activities are still much lower than pre-pandemic levels; important input factors (fuel prices, interest rates) have stabilized but remain high.

In the last 6 months of 2023, production and business activities will still face many difficulties due to input factors such as high fuel prices and unfavorable and unpredictable USD exchange rates.

In general, the global aviation market in 2023 will return to 90% of 2019, including the US, North America and Europe markets. The Asia- Pacific region, including Vietnam, will grow slowly compared to the world average and will remain a "lowland" in aviation recovery.

"Vietnamese airlines depend heavily on the Chinese market, accounting for 25-30% of total supply. When the Chinese aviation market has not recovered, it will also affect Vietnamese airlines.

Vietnam Airlines' flights to Europe and Australia have returned to nearly the same level as in 2019, and the airline has also increased frequency or opened new routes," Mr. Ha added.

Meanwhile, domestic air transport is very unusual, not returning to the recovery momentum as in 2022. The first and second quarters of 2023 saw good growth, but in the third quarter, purchasing power was slow, leading to a summer peak not as expected. In the fourth quarter of 2023, the total domestic air transport market was about 10% lower than in 2019. Mr. Ha commented that this is also a trend and will take place in 2024.

Assessing the aviation market in 2024, there are still many challenges, according to the CEO of Vietnam Airlines, the world aviation transport market will recover to the pre-COVID-19 period (2019). However, the Asia- Pacific region is forecasted to recover 1-2 points lower than in 2019.

"The global economic downturn, geopolitical conflicts, and supply chain disruptions are risks and factors that strongly impact the recovery of the aviation market. In 2024, Vietnam Airlines will develop a high-scenario plan to prepare resources for pilots, flight attendants, and engineers, and forecast that the global aviation market will return to 90% of 2019 levels. Therefore, the airline will open more Vietnam-China routes and monitor market developments to adjust capacity," said Mr. Ha.

Opportunity for Vietnam Airlines to regain part of the market

Shareholders also raised questions related to changes in the aviation market in 2023 such as Bamboo Airways' fleet being reduced from 30 aircraft to 9; adjusting the flight network to reduce international flights and focus on domestic flights...

According to Vietnam Airlines General Director Le Hong Ha, based on the actual market demand and Vietnam Airlines' capabilities, the airline has proactively adjusted the supply capacity of international and domestic routes. This is to partly meet the market demand and the decrease in supply capacity of Bamboo Airways, and is also an opportunity for the airline to regain a part of the market.

Regarding human resources, in response to the opinion that this is also an opportunity for Vietnam Airlines to find high-quality labor to meet the company's development requirements, Vietnam Airlines leaders said that the company also has to balance within the Vietnam Airlines Group because Pacific Airlines is currently restructuring, so it is necessary to raise the issue of using shared resources.

The opportunity to use high-quality labor resources from Bamboo Airways is being evaluated and the ability to use them in the right position that Vietnam Airlines needs.

(Source: Lao Dong Newspaper)

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