Vietnam has it all. Stunning beaches. Vibrant cities. Exotic food. Friendly people. Affordability. Yet travelling beyond Ho Chi Minh, Da Nang, and Hanoi isn’t always easy. Visiting the more remote tourist areas can be time consuming since air service isn’t that frequent or efficient.
A fleet of regional aircraft would be instrumental in redressing those deficiencies and unlocking the country’s enormous potential. This type of aircraft removes the need for extensive airport upgrades, necessary to accommodate bigger aircraft. In cases where airport upgrades are needed, regional jets require between 25-50% lower upgrade cost compared to large narrow-body aircraft. In our analysis titled Vietnam’s Air Connectivity Potential, we examine why smaller-capacity jets are ideally sized to improve Vietnam’s air network connectivity and develop the national economy.
Our analysis explores key demographic and growth indicators and cites the example of Côn Đảo where the recent acquisition of smaller jets is opening the scenic and historic island to new investment and tourists. Tourism is a powerful contributor to Vietnam’s GDP. According to IATA, foreign tourists spend nearly USD10 billion annually in the country. Their expenditures in local economies help to provide jobs to some 1.8 million of Vietnam’s 100 million citizens.
Vietnam has one of the fastest growing economies in Southeast Asia, around 6.4% annually. That strength is expected to continue through 2030. Demand for air travel is forecast to increase accordingly. Although overseas visitors are fueling much of the growth, the propensity to travel among Vietnamese nationals is comparatively low. In 2019, Thai citizens took twice as many trips as their Vietnamese neighbors, and Malaysians flew three times more often.
The country’s airlines still allocate most of their flights to trunk routes. Around 65% of new seats added over the last 5 years were flown to major cities. Yet to develop more domestic markets and build network connectivity, smaller-capacity aircraft will be essential for profitable, sustainable growth. The range, weight, and operating efficiency of sub 150-seat airplanes means they can often go where larger jets can not. Moreover, the aircraft can link primary and secondary cities in Vietnam with nonstop flights to/from regional markets across Southeast Asia.
We invite you to learn more about Vietnam’s Air Connectivity Potential and why we see tremendous opportunity for regional jets to improve air service on some 60 underserved markets. Our case studies, aircraft operating cost comparisons, and growth strategies present a compelling reason why smaller-capacity airplanes can turn Vietnam into an aviation tiger.
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