b777a340fan
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Is Vietnam An Untapped Market?

Mon Apr 09, 2007 10:46 pm

Vietnam is perhaps one of the most populous countries in the world, considering its relatively "small" landmass, yet it only has one main airline. With many predictions estimating its economy to be boom even more in the next years to come, would it be possible to see the birth of a new airline competing with the current Vietnam Airlines? Would we see other foreign airlines offering more flights?
 
HB-IWC
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RE: Is Vietnam An Untapped Market?

Mon Apr 09, 2007 10:54 pm

The problem with the Vietnam market is that it's rather low yielding, and the recent arrival of the Middle Eastern airline companies (QR just started DOH SGN ops) will not do anything to help that situation. A good indicator of how yields are not all that magnificent is Air France's decision to give up on nonstop CDG SGN and CDG HAN flights during the busy northern winter season - AF's flights have been routed via BKK again during the past winter schedule.
 
andaman
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RE: Is Vietnam An Untapped Market?

Mon Apr 09, 2007 10:59 pm

As Finnair wants to expand further in Asia, also SGN or HAN have named possible destinations. But, if the yields look like that...
Chinese cookie in SFO: "You're doomed to a life of forever travelling abroad and to be able to afford it!"
 
Beaucaire
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RE: Is Vietnam An Untapped Market?

Mon Apr 09, 2007 11:10 pm

Ho Chi Minh will most definitely see stronger growth that Hanoi,considerings it's economic dynamic.
Other places like Da Nang or Hué and the southern Island of Phu Quoc are geared to see Asian Low Costs and even some more international flights from main-stream carriers.
Hanoi lacks still some appeal for foreigners as tourist city,although the Bay of Halong - three hours ride from Hanoi- attracts many visitors.
My wife just returns from a three weeks visit of the country (South to north )and loved the South ,Hoi An,Hué ,the coastal resorts ,but lesser so the North,in that people are still not geared to receive tourists with the same degree of hospitality than in the South.It's maybe a matter of political indoctrination with Communism in the North,but she felt a big difference.
By saying that,the country is a great place to visit and many attractions -both cultural and geographically-are a good reason to spend time there.Cuisine is great and hotels and restaurants are inexpensive compared to other countries in Asia.
She flew Thai from Munich via Bagkok to Saigon and all flights were packed.
Interesting remark from her was that the flight on the A340-600 from MUC to BKK was superb service,friendly staff,great food-100% satisfaction,while the return on 747 BKK to FRA was not good at all...
Vietnam Airlines generally gets lesser good ratings than Singapore or Thai,they still can improve .Also their internet-presence in Europe is not good at all-you can't book international flights and pay on-line..,limitted time-table ,very restrictive features.The web-site was completely down for 6 months !!!
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HB-IWC
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RE: Is Vietnam An Untapped Market?

Mon Apr 09, 2007 11:48 pm

Quoting Beaucaire (Reply 3):
Also their internet-presence in Europe is not good at all-you can't book international flights and pay on-line..,limitted time-table ,very restrictive features.The web-site was completely down for 6 months !!!

Last thing I heard is that Vietnam as a whole has not yet introduced the concept of e-tickets. That apparently includes all foreign carriers operating in the country as well.
 
buckieboy
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 12:10 am

All,

In answer to the original question, I would say yes, though I have only visited N Vietnam (Ha Noi, Halong Bay etc) and not places like Ho Chi Min.

Population is not the metric to determine whether air traffic should increase or not. Look at the population of Bangladesh, for example.

Vietnam, though does have many positives and I would see both Asian and non-Asian visitors increasing substantially in the next five years. Likewise, for their neighbours Laos and Cambodia.

Yields might not improve substantially until western companies significantly invest in Vietnam. Having only visited the north in 2003, I saw no evidence of western manufacturers, lest not fast food outlets there.

Nevertheless, IMHO, SE Asia is the most interesting part of the world at the moment to observe world change; more so than either China or India at the moment.

Cheers

BB
I'm taking orders from bottles of wine
 
b777a340fan
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 12:55 am

Quoting Buckieboy (Reply 5):
Yields might not improve substantially until western companies significantly invest in Vietnam. Having only visited the north in 2003, I saw no evidence of western manufacturers, lest not fast food outlets there.

Intel announced that it was building its largest manufacturing plant there.... Nike has long had a plant there as well.... Investments are pouring in quite heavily. Not only that, tourism is huge there.... I hear Westerners (esp. europeans) rave about Vietnam.
 
Jetblast25
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 1:32 am

Don't forget Pacific Airlines, which serves the domestic market and limited regional routes (BKK, TPE) with a fleet of 734s. Also, they provide online booking and issue e-tickets.
 
AADC10
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 1:40 am

Vietnam with its high density population, long but narrow coastal geography and low incomes make it ideal for rail transport. That is still how most Chinese travel despite the growth in their airlines, their comparatively spread out geography, much larger population and higher per capita income. Regularly scheduled domestic mainline flights can probably only operate between the largest cities.

International airlines like AF and UA are getting in before the market is really ready with the hope that growth will catch up to them. Neither one is able to sustain non-stop flights to their home countries year-round.
 
Airbus Lover
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 4:54 am

I travel ex-SGN from time to time and BR issues me e-tickets. But I understand that many other carries don't offer e-ticket at their Vietnam stations.

Vietnam as a whole has a lot of potential and in the airline sector, it will take some time but nevertheless will boom in the next decade or so. The new international terminal at Tan Son Nhat (SGN) will help alleviate congestion problems.

Lastly, there's always political interference, especially in a country like Vietnam. This brings about the question, if we will ever see a new airport for HCMC. Perhaps we will, but when???
 
zoom1018
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 8:43 am

Quoting Airbus Lover (Reply 9):
Lastly, there's always political interference, especially in a country like Vietnam. This brings about the question, if we will ever see a new airport for HCMC. Perhaps we will, but when???

A piece of land has been reserved for a new international airport in Long Thanh. It was set to begin constructing in 2010 but was likely pushed back a bit hence the new terminal at Tan Son Nhat. That was reported in a local press last year.
 
mindscape
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 9:49 am

To answer to the initial question, the response is NOT soon to see another Vietnamese carrier competing with Vietnam Ailrines, except if this "new" carrier is also a state own airline company.
Don't forget Vietnam is still a communist country, no matter the economic growth the country is currently experiencing...
Vietnam Airlines growth is actually a good mirror of the economy boom in the country. From a very conservative, old fashion, communist style management, it slowly blooms into an potential international player like the country is slowly opening its economy to the world... Both the airline and the country have not reach yet the cruising speed of their expansion due to contradictory political decisions from the government that see the economical expansion as inevitable but are frightened by loosing eventually their power... Vietnam and Vietnam Airlines have great potential but their expansion is still retained by the communist party leash. Hopefully in a near future this will be unleashed and may be we will see new Vietnamese carriers popping up...
 
Ryanair!!!
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 11:57 am

Quoting HB-IWC (Reply 4):
Last thing I heard is that Vietnam as a whole has not yet introduced the concept of e-tickets. That apparently includes all foreign carriers operating in the country as well.

Not true, my last trip to Saigon was purely on SQ's e-ticket.

Quoting Buckieboy (Reply 5):
Yields might not improve substantially until western companies significantly invest in Vietnam. Having only visited the north in 2003, I saw no evidence of western manufacturers, lest not fast food outlets there.

Vietnam has embraced Asian brands more than the American ones probably due to the sanctions imposed by US which was only lifted in 1994/95. Therefore, American brands probably only arrived a few years after that. As I have mentioned in my trip reports to Saigon, the only American brand (fast food wise) that I saw was KFC. Otherwise another Korean chain Lotte Fried Chicken was all over the place.

Saigon / Ho Chi Minh City remains the economic stronghold of the country despite Hanoi in the north being the country's capital. The capitalistic nature of the South never waivered, only buried, during the years between 1975 (the fall of Saigon) and 1988 (embarkation of new market economy). It was rumoured that the brave Southerners dug up buried gold stashes after the country was opened up to the world.

If anything business wise, it would happen in Saigon first before spreading northwards. Hanoi seems tamed compared to her southern sibling with narrower streets, slower pace and even the architecture takes on a slightly more clinical slant with Sovet-styled bunker buildings dominating the surroundings.

Just take a walk down District One in Saigon, you can feel the air of possibility and vibrance. The energy is pulsating with the young ones raring to take on the world. But that being said, Vietnam has a lot to do to catch up. The country's infrastructure is still in its infancy and it is mostly always a frustrating adventure to get anywhere without your query being lost in translation or you getting ripped off.

Despite the ideology of Communism slowly dying in our world today, the fundamental ruling stance is still what polices the country presently. Although the "secret police" is seldom mentioned, they are still around and the locals do not participate in political debates. Even foreigners are discouraged from engaging a local in a discussion about their leaders (So I feel that your Prime Minister is a shithead... What do you think, Mr Nguyen?)...

So yes, Vietnam is a country that is teeming with potential (LOTS OF IT) one might say. In fact, I do business with their people on a daily basis. Although not easy, it is worth it at the end of the day. Vietnam is the new Thailand, as far as I am concerned. Walking down the streets of Saigon brings back many vivid memories of how Bangkok used to be some 20 years ago.

Singapore to Saigon on SQ
Saigon to Singapore on SQ
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vincewy
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 5:05 pm

Isn't Vietnam planning to build a high speed rail link between HCMC and Hanoi? Current travel time by rail can be up to 40 hours, if they can cut it down to 5 hours on rails and make it cheap for masses, it'll help boost the economy even further.
 
HB-IWC
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RE: Is Vietnam An Untapped Market?

Tue Apr 10, 2007 8:36 pm

Quoting Ryanair!!! (Reply 12):
Not true, my last trip to Saigon was purely on SQ's e-ticket.

I was refering to tickets issued in Vietnam.
 
azncsa4qf744er
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RE: Is Vietnam An Untapped Market?

Thu Apr 12, 2007 10:57 pm

United Airlines flight UA869/862 to and from HKG to SGN are never full. The only times the Economy cabin is filled up is during the holiday season of Tet (Vietnamese New Year). Other than that the flight will depart/arrives almost half full in economy cabin. Not much high yield on either of UA's three cabin. Mainly Staff travel up front. Cargo do play a good part on UA SGN ops though. Lots and lots of cargo pellets are loaded from HKG to SGN every single night. SGN is a low yield market.

The same applies for JetStar from Australia. The new flight has only seen the highest yield of 70% load factor. That's the higest I've ever seen from flight booking.
 
GneissGuy
Posts: 169
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RE: Is Vietnam An Untapped Market?

Fri Apr 13, 2007 1:52 pm

Well, i can tell you for sure (based on reliable information) that SGN-SIN / SIN-SGN sector is THE fastest frowing sector for Singapore's airlines.
 
goldorak
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RE: Is Vietnam An Untapped Market?

Fri Apr 13, 2007 3:26 pm

Quoting HB-IWC (Reply 14):
I was refering to tickets issued in Vietnam.

not only. I'm going to HAN/SGN in 2 weeks with AF via BKK and I needed a paper ticket (you can fly AF CDG-BKK with an e-ticket but not CDG-HAN/SGN via BKK). I suppose it's because AF ground op in Vietnam are handled by VN who doesn't have implemented e-ticket yet ?
 
Airbus Lover
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RE: Is Vietnam An Untapped Market?

Fri Apr 13, 2007 5:58 pm

EVA issues e-ticket in SGN. In fact, this started some time last year when all they give me is a nice print out with BR letterhead.

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