VietJet in talks over joint ventures
Vietnam-based low-cost carrier (LCC) VietJet Air is looking to expand its north Asian reach using alliances and joint ventures (JV) with other airlines, rather than extend its existing route network.
May 1, 2015
Vietnam-based low-cost carrier (LCC) VietJet Air is looking to expand its north Asian reach using alliances and joint ventures (JV) with other airlines, rather than extend its existing route network. Th e airline said it initially wants to establish JVs with other carriers in Japan, South Korea and Taiwan.
Speaking to Reuters, VietJet managing director Luu Duc Khanh said the north Asian market holds more appeal for the Vietnamese budget carrier as it is relatively less competitive. “Although Southeast Asia is still on our [expansion] radar, it is a little bit crowded,” Luu said. “We want to capture loyalty domestically then expand regionally and eventually, long haul.”
Founded in 2010, VietJetAir is expanding rapidly with 93 A320 Family jets on order from Airbus Industrie. Th e LCC plans to fund its growth with bond issues and bank loans in addition to an IPO due later this year.
Vietjet Air Cargo was launched last November and aims to tap the growing volumes of air cargo from Vietnam’s diversifying economy, including smartphones, electronic devices, timesensitive goods (garments, clothes, fresh seafood) and diplomatic items, etc. Samsung, Nokia, Microsoft, Canon, and Foxcon are all producing electronics goods in Vietnam.
According to International Air Transport Association (IATA), Vietnamese air cargo reached 680,000 tonnes of commodities in 2013, including 300,000 tons of import-export goods.