Domestic tourism under threat from high flight costs

As the approaching long holiday period from April 30 to May 1, many travellers have begun planning their trips. However, instead of opting for domestic destinations, they are choosing to travel abroad.

Chau Anh, who lives in Hanoi, has decided to purchase a five-day tour to South Korea instead of her initial plan to visit Phu Quoc.

“The cost of the trip to South Korea and Phu Quoc does not have a significant difference, so my family has chosen to travel abroad for a more unique experience,” she said.

According to Chau Anh, the price of the South Korea tour is only about $700 per person, while the airfare to Phu Quoc alone is already over $330 per person, not including accommodation, transportation, and dining expenses.

Domestic tourism under threat from high flight costs

Round-trip airfare for the Hanoi-Phu Quoc route departing on April 28 and returning on May 3 with Vietnam Airlines, Vietravel Airlines, or Vietjet ranges $290-540 per ticket.

For the Hanoi-Dalat route, airfare prices on April 27 with Vietjet range from $112 to $162 per round-trip, while Vietnam Airlines offers prices of $160-540 per round-trip

For the Hanoi-Nha Trang route departing on April 28 and returning on May 3, the best price available is $162 per round-trip ticket, while the highest price is $320.

From the beginning of March, the ceiling price for tickets on domestic flight routes increased by approximately 3.8 per cent. According to Le Hong Ha, CEO of Vietnam Airlines, this is the first time in nearly 10 years that the aviation industry has adjusted the ceiling price for domestic airfares.

“Many input costs in the aviation industry have changed, particularly fuel prices and exchange rates, as the industry primarily uses USD in its cost structure. Therefore, the adjustment of the ceiling price for airfares is reasonable for airline operators,” Ha said.

Nguyen Minh Man, director of communications and marketing at TSTtourist, said the March adjustment has had an immediate impact on domestic tours. As a result, tour prices also need to be adjusted accordingly.

“This will make the domestic tourism industry face more challenges in competing with international tourism,” Man said. “Domestic tourism options such as short-distance travel and independent travel will likely see a significant increase.”

According to Pham Anh Vu, director of communications at Viet Media Travel Corporation, the high airfare prices in 2023 have led to an increase in domestic tour prices, reducing the choices for tourists for various domestic destinations such as Phu Quoc and Halong. After comparing domestic tour prices with nearby tourist spots like Thailand and Singapore, many tourists have decided to travel abroad.

“The impact of the domestic air ticket price increase on the tourism industry will become evident starting from the beginning of April when the demand for travel starts to rise,” said Vu.

Doan Thi Thanh Tra, marketing director of Saigontourist, said travellers departing from Ho Chi Minh City can switch from package tours to independent travel in destinations such as Vung Tau, Phan Thiet, and Nha Trang. Meanwhile, travellers departing from Hanoi tend to choose nearby destinations such as Quang Ninh, Haiphong, Sapa, and Thanh Hoa.

“With the convenience of travelling by highways, travel businesses have to proactively find ways to adapt. Saigontourist has shifted its focus to providing customisable services at destinations, not only booking hotels but also arranging tickets for attractions, amusement parks, or restaurants to meet all the needs of self-guided tour travellers,” Tra said.

According to the Civil Aviation Authority of Vietnam (CAAV), one of the factors affecting ticket prices is the shortage of aircraft due to airlines conducting regular maintenance after the peak Lunar New Year period in 2024 and preparing for the high-demand summer season.

Additionally, Pacific Airlines and Bamboo Airways are also restructuring their aircraft fleets, which has resulted in a reduction in the number of aircraft in operation.

“The price fluctuations on certain routes during the peak summer period compared to normal days are in line with the law of supply and demand,” said Dinh Viet Thang, director general of the CAAV.

Thang also said that the CAAV has instructed airlines to implement plans such as leasing aircraft, flight crews, or purchasing additional aircraft to provide reasonable airfare prices to meet the demands of passengers, ensuring smooth travel for tourists during the peak summer period in 2024 and the Lunar New Year in 2025.

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