Transport enterprises suffer heavy losses

May 18, 2021 | 17:21
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Four COVID-19 outbreaks in a single year have pushed transport businesses deeper into losses.
transport enterprises suffer heavy losses
Bottom lines have been hitting rock bottom at transport enterprises

With Vietnam seeing the fourth outbreak of COVID-19 this time, the country's entire railway network has been almost completely frozen. There are only two passenger trains and about 10 freight trains running each day, while there were 40 trains running between Hanoi and Ho Chi Minh City only before the pandemic outbreak.

Vietnam Railways Corporation (VNR) said that passenger volume has dropped 90 per cent. Specifically, on May 13, 2021, VNR obtained VND600 million ($26,090) from passenger trains and VND5 billion ($217,400) from freight trains, only half of their earnings before the pandemic (more than VND10 billion ~ $434,780). This forced the corporation to have about half of its workforce take alternative breaks. "The corporation has estimated to lose VND700 billion-1 trillion ($30.43-43.5 million) this year," Vu Anh Minh from VNR said.

In the aviation sector, Vietnam Airlines operated about 500 flights every day. Due to the pandemic, it has cut down its flights to 65, which were only half full at all times.

Noi Bai International Airport (Hanoi) said that passenger count has decreased sharply recently. On its most crowded day during the April 30 and May 1 holidays, the airport received 540 flights with 79,000 passengers. However, these figures have dropped to 90-200 flights and 9,000-15,000 passengers a day since the fourth outbreak. "The number of flights and passengers is forecast to further reduce in the time to come," a representative of Noi Bai International Airport said.

Luu Huy Ha, chairman of passenger transportation service company Hoang Ha JSC said that the car rental business has almost closed, while only 10-20 per cent of seats of inter-city buses are occupied. Before the pandemic, 200 buses were operated each day on the Thai Binh-Hanoi route, which has dropped to 20-30 now. The number of buses and taxis running has also reduced by 50 per cent.

In the first quarter of 2021, Hoang Ha JSC lost VND15 billion ($652,170), while it gained VND4 billion ($173,910) in profit in the same period of 2019, and lost VND66 billion ($2.87 million) altogether last year. "I am not sure how much longer we can take losses," said Ha.

Employees of these transport businesses have been working alternatively and their incomes were reduced to the minimum wage. Thereby, the representative of businesses and the Hanoi Taxi-Truck Association recommended the government to extend tax payment deadlines and temporarily exempt added value, exempt insurance premiums paid for employees whose contracts are terminated, and who work in rotation.

"We hope that the government could delay tax payments of 2020-2021 to 2022," Nguyen Cong Hung, chairman of the association said.

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