For the first time in history, the fast-growing Vietnamese air transport market is now connected non-stop with the United Kingdom. On 8 December, Vietnam Airlines launched a twice-weekly service from Hanoi to London’s Gatwick Airport, anna.aero’s local airport, on 9 December followed by an also twice-weekly operation to the London airport from Ho Chi Minh City, as detailed in this week’s new route report. This makes London Vietnam Airlines’ fourth European destination after Paris, Frankfurt and Moscow.
Pham Ngoc Minh, president and CEO of Vietnam Airlines, said: “There is no question that there is potential and a determination to bring the partnership between Vietnam and the UK to a new level. And direct air services, I believe, can definitely deliver enormous economic and social benefits. Vietnam will now seem so much closer for UK travellers, with flight times cut to 12 hours.”
The four weekly flights are currently operated with 308-seat 777-200ER aircraft, however; by the time the airline takes delivery of its 787s in 2015, the intention is that frequencies already will have increased to a combined daily operation.
Vietnam Airlines estimates the UK-Vietnam market to be 90,000 passengers per year, which can be put in relation to the Vietnam-China market being double the size. However, the airline also expects the market to continue to grow, already having increased by as much as 20% in good years. Not the least stimulated by its new non-stop service, Vietnam Airlines’ expectation is that the market will grow by 10-12% next year. The airline’s own ambition is to initially capture 30% of total traffic between the two countries, gradually growing to a 40% share of the market. This would be achieved both with the new direct services and through passengers transferring through the other European hubs the airline serves with higher frequencies.
In addition to point-to-point travel, Vietnam Airlines’ seeks to feed other regional destinations in South East Asia, particularly in its core Indochina home market. As a niche-carrier, it doesn’t seek to compete with the MEB3 carriers’ aggressive volumes between Europe and Australia, but does offer the Kangaroo route with an enhanced product with a free stop-over in Vietnam with hotel stay and visa included.
London planned for 13 years; widebody orders ensure further long-haul growth
Dr Minh revealed that Vietnam Airlines has sought to enter the London market since 1998, but has been unable to obtain slots at Heathrow Airport where it would have connectivity with a number of its partner airlines. It was, however, now deemed that this is an important time for the airline to enter the growing market, not the least after the UK-Vietnam Strategic Partnership was signed last year and with London being an Olympic host city next year. The airline is also very pleased with the service level now offered by Gatwick Airport.
The two new routes make London Vietnam Airlines’ 28th international destination and 48th destination overall. However, further rapid expansion is on the horizon as the SkyTeam carrier’s current fleet of 74 aircraft is set to expand to 115 by 2015 and 170 aircraft by 2020.
For more information about Vietnam Airlines’ network plans, read anna.aero’s 30-second interview with Dr Minh.