Despite fierce competition between domestic and international air carriers, Vietnam Airlines Corporation maintained increasing revenue and profit in the first three quarters as well as retained the Four-Star Airline Certification for the second consecutive year.
Vietnam Airlines Corporation's continuous improvements have born fruit
Record profit in third quarter
After posting double-digit growth in revenue as well as profit for numerous years, the domestic aviation market has seen slowing growth with signs of saturation. According to statistics from Civil Aviation Authority of Vietnam, in September 2017, the aviation sector’s flight control output was 31,050 flights, increasing only 6.8 per cent on-year.
However, the corporation still reported sparkling business results. Notably, within the nine months of this year, Vietnam Airlines maintained its market share of 56 per cent by handling 16 million passengers and 235,525 tonnes of cargo, equalling 75 and 79.1 per cent of its annual targets.
In spite of lacking the business results for the last days of September, in general, in the first three quarters of this year, Vietnam Airlines earned VND65.1 trillion ($2.85 billion) in consolidated revenue, up 20 per cent on-year, and VND2.26 trillion ($98.8 million) in consolidated pre-tax profit, equalling 138 per cent of its plan for the whole year.
The parent company Vietnam Airlines alone earned VND1.26 trillion ($55.08 million) in pre-tax profit. In the third quarter, it acquired VND1.09 trillion ($47.6 million) in pre-tax profit, establishing a new record for the Vietnamese aviation industry.
The corporation has changed investment methods in aircrafts. Accordingly, instead of using loans for purchasing new aircraft models, Vietnam Airlines will use the sale and leaseback method. Notably, Vietnam Airlines found buyers for three new-generation A350s aircrafts it expected to receive in 2016-2017 under an aircraft purchase contract signed with Airbus and then leased them back to use for the long term.
In late August, the corporation released plans to sale and leaseback one GEnx-1B74/75 spare propulsion engine (SPE) for its B787 fleet with the ToT schedule in December 2017.
This method is to control the money Vietnam Airlines has to borrow to afford the purchases for the Airbus 305-seat aircraft, while still ensures an adequate number of planes for its operation.
One outstanding point relating to service quality is that it was certified for the second consecutive year as a four-star airline by UK-based airline and airport rating organisation Skytrax, following Air France, Lufthansa from Germany, and Emirates Airlines from UEA.
The service quality of Vietnam Airlines has been continuously improving, reaching 90 per cent of Skytrax’s criteria for four-five star airlines. The customer satisfaction index was 3.83 out of 5 points, higher than past year’s results as well as expectations. During the nine months of 2017 so far, Vietnam Airlines operated more than 108,271 safe flights.
On July 3, the corporation launched a new 24/7 customer service centre, which is considered a large step forward for service quality.
In the fourth quarter of this year, Vietnam Airlines will launch special economy class for domestic flights with numerous advantages compared to the exiting economy class.
Previously, Vietnam Airlines opened three business lounges in the international and domestic terminals of Noi Bai and Tan Son Nhat international airports.