AirAsia’s Tony Fernandes was in Hanoi this week to sign Memorandun of Cooperation with Vietnamese counterpart to start a new airline in the country (likely named AirAsia Vietnam).
Under the current law, foreign entity can own maximum of 30% of a Vietnamese airline. The government may change this to 49%.
Here’s the press release from AirAsia:
HANOI, 6 December 2018 – AirAsia has signed a Memorandum of Cooperation reaffirming its intention to set up a low-cost carrier in Vietnam with local partners.
The memorandum was signed by AirAsia Group CEO Tony Fernandes and Vietnamese businessman Tran Trong Kien, in his capacity as CEO of Thien Minh Travel Joint Stock Company (TMG) and General Director of Hai Au Aviation Joint Stock Company (HAA), at the InterContinental Hanoi Landmark72 here today.
The signing, conducted on the sidelines of the Vietnam Travel and Tourism Summit 2018, was witnessed by Vietnamese Deputy Prime Minister Vu Duc Dam and Vietnamese Deputy Minister of Culture, Sports and Tourism Le Quang Tung.
AirAsia Group CEO Tony Fernandes said, “AirAsia is an Asean airline. And in Asean, Vietnam is one of the last remaining countries with a large population we’re not in. Today’s memorandum reaffirms our commitment to making AirAsia in Vietnam happen. Last year, when we announced this JV, we were bullish about Vietnam and we remain incredibly bullish about serving one of the most dynamic, fastest-growing economies in Asia.
“AirAsia is already the largest foreign airline group in Vietnam by capacity. We currently operate to five destinations here, including our most recent addition, Phu Quoc. And we will continue to expand our network to connect Vietnam to Asean and beyond, something our local JV will be able to accelerate. We couldn’t be more excited about the prospect of bringing more visitors to this amazing country and delivering true low-cost air travel to 95 million Vietnamese in the near future.”
TMG CEO and HAA General Director Tran Trong Kien said, “Vietnam tourism has performed extremely well. The number of international arrivals has doubled over the last three years and domestic and outbound travel have also grown tremendously. The sector has contributed greatly to recent economic development and social progress. Vietnam as a country needs better connectivity to continue this trend and for tourism to reach its full potential. Adding a new airline, especially at this stage and with an experienced operator like AirAsia, is a much needed and welcomed move. This new airline will bring more and better choices to our people in the years to come.”
The air travel has truly taken off in Vietnam in the past decade when larger share of the population has entered the middle class. The country already has two LCC’s of VietJet (already has subsidiary in Thailand) and JetStar. Vietnam Airlines is the full service “flag” carrier and member of SkyTeam.
There is new airline called Bamboo supposedly taken off before the end of this year and this new AirAsia offshoot sometime in 2019.
AirAsia has number of partnerships beyond of its core Malaysia operations in Thailand, Indonesia, Philippines and India.