The Covid-19 pandemic is having a serious impact on the world aviation, forcing airlines to seek relief, lay off employees and cut down the costs … In this spiral, Vietnamese airlines also are facing accumulated difficulties. The damage to the Vietnamese aviation industry due to the Covid-19 epidemic is very serious, the number of passengers and goods transported both decline sharply. Generally for 9 months, passengers carried by airway reached 22.5 million passengers, a decrease of 45.5% over the same period last year and passengers traffic gained 25.4 billion passengers-km, a decline of 55.9%; freight carried reached 196.6 million tons, down 39.4% against the similar period last year and freight traffic gained 2.6 billion tons-km, down 54.2%. Due to the limited operation of the flights, the airline’s revenue fell sharply, and the airlines is facing a high risk of bankruptcy because they can not cover the large costs to maintain operations.
However, in the context of the well-controlled of Covid-19 epidemic in Viet Nam as well as some countries around the world, from mid-September 2020, airlines announced to re-open and increase the frequency of many domestic flights, restore some international commercial routes to meet the needs of passengers, contribute to connecting trade and maintaining production and business activities. In October 2020, passengers carried and freight carried by airway increased 25.1% and 21.8%.
This is a positive signal which show that the aviation industry is gradually recovering, in which is mainly contributed by the domestic market. However, passengers carried by airway in ten months still decreased 44.6% over the same period last year and passengers traffic was down 56.4%; freight carried reduced by 38.5% and freight traffic went down by 55.2%. This shows that Vietnamese airlines are still facing many difficulties, requiring their best efforce to find opportunities for themselves.
In a report on 28 September 2020, Fitch Ratings stated “Passenger traffic at Vietnamese airlines should rebound faster than in other southeast Asian markets due to the country’s low incidence of COVID-19 cases. Fitch Ratings forecast average RPKs of Viet Nam around 55% of the baseline level in 2020 and 90% in 2021; Singapore Airlines, on the other hand, could witness the sharpest 2020 RPK fall, at 70%, due to its complete dependence on international routes, with 2021’s RPKs staying at around 50% below 2019 levels Indonesia and the Philippines, where further COVID-19 spread remains a high risk, to see average RPK levels at 35% of the baseline in 2020 and 60% in 2021; Airlines in Thailand and Malaysia are also likely to report similar levels, as they would be affected by weak international traffic volume despite the countries’ success in controlling the pandemic.
With the above positive signals, it is forecasted that Vietnamese airlines’ market will strongly recovery in this year and in 2021. However, we will still face many potential difficulties as the Covid-19 continues to be complicated and uncontrolled in the world.