Residual growth for the aviation industry in 2019

	Unblock bottlenecks for development of aviation infrastructure say experts
	"Bottlenecks " of private airline businesses

The runways at Noi Bai and Tan Son Nhat are at risk of being closed for repairs after long periods of overloading, which will affect many airline enterprises. Photo: collected

Shipping over 50 million passengers

According to the Vietnam Aviation Administration, in 2018, Vietnam's aviation market continued to have stable growth. Accordingly, volume of passengers was estimated at 106 million passengers, increasing by 12.9% and cargo volume, reached nearly 1.5 million tons of goods, increasing by 7.7% compared to 2017. In the year of 2018, the transport of Vietnamese airlines reached over 50 million passengers, an increase of 14% and nearly 400 thousand tons of goods, an increase of 26% compared to 2017. The total of Vietnamese air transport market was estimated 71.4 million passengers, up 15% compared to 2017 in 2018.

Currently, the Vietnam aviation market has the participation of 68 foreign airlines from 25 countries and territories and 4 Vietnamese airlines including Vietnam Airlines, VietJet Air, Jetstar Pacific Airlines and VASCO. In international markets, 68 foreign airlines and 3 Vietnamese airlines are exploiting nearly 130 international routes between Hanoi, Ho Chi Minh City, Da Nang, Nha Trang, Phu Quoc, Hai Phong and 28 countries and territories. In the domestic market, currently, the four airlines operate 48 domestic routes connecting Hanoi, Da Nang and Ho Chi Minh City with 18 local airports across the country.

As a leading enterprise in the aviation industry, 2018 is the first time that the total consolidated revenue of Vietnam Airlines Corporation (Vietnam Airlines) has exceeded more than VND 100,000 billion, estimated at 102,000 billion VND, pre-tax consolidated profit is estimated at nearly 2,800 billion VND, up 15% compared to the plan. In which, the parent company is estimated to reach 73,500 billion VND in revenue and 2,012 billion VND in pre-tax profit, reaching 102.7% of the plan for 2018. The total consolidated payment for the budget in 2018 is nearly 6,600 billion VND.

Financial indicators of Vietnam Airlines are also improved in the direction of safety. Ratio of Operating Profit Margin reached 4.38%. Debts on equity (D/E) fell below 3 times, lower than the beginning of 2018.

Along with the steady growth in financial indicators in 2018, Vietnam Airlines is estimated to secure nearly 142,000 flights, transport 22 million passengers and nearly 350 thousand tons of goods. The on-time performance (OTP) index exceeded the target in the year and reached a high level of 90%.

In 2018, Vietnam Airlines' fleet continues to be expanded and upgraded with the addition of 2 wide-body Airbus A350 aircraft and 3 new generation narrow body aircraft A321neo. The modern fleet was put into operation during the year, contributing to the overall success of Vietnam Airlines as well as affirming the brand, and the position of a 4-star airline for the third consecutive year according to Skytrax standard.

Focal investment points

Mr. Duong Tri Thanh, General Director of Vietnam Airlines, said that it was the first time Vietnam Airlines' profit had exceeded 2,000 billion dong in 2018. “This is also the year we focused on preparing resources, upgrading product quality, especially ensuring stable on-time exploitation. The success of 2018 will create an important foundation for Vietnam Airlines' development in 2019,” Mr. Thanh emphasized.

According to the plan, in 2019, Vietnam Airlines will continue the goal of implementing big plans including completing procedures related to the equitization process, increasing the charter capital of the Corporation and listing in the HOSE floor; completing the plan of developing aircraft fleet in the period of 2021 - 2025, vision to 2030; applying the information technology 4.0; Synchronizing the IT systems, optimizing production based on the aviation industry standards towards to the digital business model.

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Regarding the 2019 plan, Airport Corporation of Vietnam (ACV) will continue to implement investment, upgrade and renovate the airport infrastructure, especially focus on and prioritize all force sources to invest in construction and development of strategic airports such as Long Thanh. Some projects will be implemented in 2019, including: Expanding the parking space at high-frequency ports such as Noi Bai, Tan Son Nhat, Da Nang, Cam Ranh, Lien Khuong, Cat Bi, Vinh, Phu Posts.

At the same time, ACV intends to implement investment preparation steps for key projects: New construction of passenger terminal T3 at Tan Son Nhat international airport, Da Nang international airport passenger terminal, Cam Ranh International Airport Passenger Terminal, expanding passenger terminal T2 Noi Bai international airport, building T2 passenger terminal at Cat Bi, Vinh, Phu Bai and Dong Hoi, Tho Xuan airports.