Vietjet inspires firms to new heights

Four years ago when Vietjet started out, many people thought a private airline would not survive in a fiercely competitive market like air transport. Were you and your staff also worried? Why did you still decide to do it?

Four years ago, travelling by air was a luxury. I remember every end of the year, workers at industrial parks in Binh Duong, Dong Nai, and Ho Chi Minh City, who left for the Tet holiday, had to travel in crowded long-distance coaches in order to visit their families. Some could not even afford a ticket.

The situation motivated us. Vietjet wanted to give more people the opportunity to fly. We want all Vietnamese to have the chance to travel by air safely, economically, and with quality. We want to bring about a revolution in transportation for Vietnamese and want to bring Vietnam’s air transport sector to world quality standard.

It was not an easy road, but then again for businesspeople, there are no easy roads. We had faith though, because we were very determined, and also because we felt that the time was appropriate. At that point, due to the pressure resulting from the ascension to the WTO, as it came with commitments including opening the air transport sector, the government had policies to support the Vietnamese air transport sector so that it could compete with the world. The Ministry of Transport (MoT) and the Civil Aviation Authority of Vietnam (CAAV) had big changes to open up the market for private airlines. Moreover, the market of almost 100 million people all wanted to use the modern and safe vehicle that is the airplane.

We had all the right conditions to start providing services, and fortunately we have been receiving support from customers.

Vietjet is like a phenomenon not only in the domestic air transport sector but also in the world air transport sector with remarkable achievements in such a short time. There are many things to be proud of, but for you and your cofounders, what’s the most meaningful achievement?

With a sustainable development plan, a good investment plan, and the government’s policy to privatise the air transport sector, after four years, Vietjet has served 18 million passengers.

According to statistics by the CAAV, air transport grew by 26 per cent in the first half of 2015, 70 per cent of which was Vietjet’s contribution. Vietjet has increased competition in the market, which in turn caused positive changes in other airlines’ operation and service quality.

Vietjet has a fleet of 28 aircrafts, including A320s and A321s, and operates 180 flights each day, domestically and to international destinations, such as Thailand, Singapore, South Korea, Taiwan, China, and Myanmar.

These growth numbers are something to be proud of, but the most important achievement for Vietjet is that we have made air traveling, which used to be a luxury, affordable to the better part of the Vietnamese population. As of now, between Hanoi and Ho Chi Minh City, there are more than 50 flights per day, departing every 15-20 minutes. Between Ho Chi Minh City and Danang, there are 30 flights each day. Local airports become busier with Vietjet’s domestic and international flights, and flyers have come to expect better and better service during their travels.

Outside of Vietnam, Vietjet brings the image of a modern and bustling Vietnam, which contributes to increasing the appeal of the country as a destination for investment and tourism.

I, as well as all the employees at Vietjet, are proud that we have contributed to the good changes in the field.

Based on its successes to date and rapidly expanding fleet of aircraft, the sky is the limit for Vietjet

The ASEAN countries are moving towards a common aviation sector, and they will all fly in one open sky. What is Vietjet’s plan to make use of the opportunity and overcome the challenges that this brings about?

The opening of the ASEAN skies is a turning point for the sector. It is an opportunity for Vietnamese airlines to expand their routes to countries in the region. Connecting destinations in Southeast Asia is going to be a lot more convenient, because of the commitments of the governments in the open sky agreement.

But on the other hand, the ASEAN open sky is going to put airlines in fiercer competition, forcing them to increase quality and lower prices. This is going to help customers in the region to travel at lower prices. In this regard, the tourism sector will benefit the most from the ASEAN open sky.

To compete with regional airlines, Vietjet seeks to ensure safety, and train our human resources to ensure the quality of our services.

Vietjet recently received the IATA Operational Safety Audit (IOSA) certificate from the International Air Transportation Association (IATA) for meeting international operational standards. Vietjet, as such, became the second Vietnamese airline after the flagship carrier Vietnam Airlines to receive the certification making it one of the 16 per cent of airlines that received the certification.

In January, Vietjet unveiled its revamped training facility in Ho Chi Minh City, with extensive new space and modern facilities, meeting the demand of teaching, learning, and increasing the number of students.

We believe that calling for private investors will help push the development of Vietnam’s air transport sector. Monopoly and unfair competition can be prevented using the regulations that the CAAV and the MoT are building.

Open skies means challenges, but opportunities too. Plus, with the government’s determination to modernise and people’s demand for air transport, Vietjet is going to receive support and grow both in scale and quality.

With the ASEAN Economic Community, the Trans-Pacific Partnership, and the many free trade agreements that Vietnam has signed, Vietnam is going to integrate even deeper into the world economy. This integration could put Vietnamese companies in tougher competition with foreign counterparts, but could also bring about the opportunity for them to strike up international partnerships. What prospects does Vietjet see in the integration?

Vietjet has been having very successful co-operation with foreign companies. In June, at the Paris Air Show 2015, Vietjet inked a deal with aircraft manufacturer Airbus to purchase six more A321 jets worth a total of $682 million. These aircrafts will be delivered in 2017. The purchase of these single-aisle A321s is in addition to a deal made last year by Vietjet and the European aircraft manufacturer for the purchase and lease of 100 aircraft.

Not only increasing its cooperation with Airbus, last month Vietjet signed the Memorandum of Collaboration (MOC) with Boeing to research ways to upgrade their partnership. Vietjet is considering buying Boeing aircrafts and equipment and other related services, as well as cooperate with Boeing in other fields, such as fleet development planning, training and flight management, public relations, brand building, and finance.

In July, Vietjet signed a memorandum of understanding (MOU) with US multinational Honeywell Aerospace to cooperate in the design and production of $56 million worth of data management equipment on aircraft.

These cooperations work thanks to the effort of both sides and they have been successful.

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