Vietnam Airlines vs. Bamboo Airways: The Quest to Launch Direct Flights to the United States



Vietnamese airline Vietnam Airlines and new local competitor Bamboo Airways are working to complete processes to obtain clearance from US agencies to begin regular direct flights to the United States

Vietnam Airlines dropped permanent commercial flights between Ho Chi Minh City and San Francisco on Saturday, paving the way for the first permanent non-stop service between the United States and Vietnam. These flights will be operated twice a week on Sundays and Wednesdays from November 28, using the carrier’s Airbus A350-900, by the aeronautical network.

Last month, the Hanoi-based carrier received approval from the Transportation Security Administration (TSA) to operate scheduled commercial operations from Vietnam to the United States, leaving regulatory approval from the Federal Aviation Administration (FAA) as last hurdle before adding service to the United States in August 2019, Vietnam Airlines received approval from the Department of Transportation for a foreign air carrier permit and flight rights from Hanoi or Ho Chi Minh City to Dallas, Los Angeles, New York, San Francisco and Seattle via possible intermediate points in Osaka, Japan; Nagoya, Japan or Taipei.

Carrier Skyteam’s inaugural commercial flight to the United States will be operated with a Boeing 787 Dreamliner, although it is not clear whether Vietnam Airlines will operate the flight with its Boeing 787-9 or Boeing 787-10 variant. Vietnam Airlines Flight 98 departs Ho Chi Minh City at 8:40 p.m. and lands in San Francisco at 7:30 p.m. On the return trip, Vietnam Airlines Flight 99 departs San Francisco at 10:00 p.m. and arrives in Ho Chi Minh City at 6:00 p.m. : 40 h, two days before the initial departure.

Currently, these flights are recorded until the end of March 2021, according to hourly data on their website. Additionally, at the time of writing, these flights are not available for booking.

In August, in an interview with Bloomberg, Le Hong Ha, CEO of Vietnam Airlines, explained that flights between Vietnam and the United States would depend on freight demand to offset the initial low demand for passengers. He added that the route would include a refueling stop, although this is not reflected in the current schedule offer.

According to RoutesOnline, Saber data shows that O&D – Origin and Destination – traffic between the United States and Vietnam totaled 1.77 million passengers in 2019, with 198,000 passengers on the Ho Chi Minh City to San route. Francisco. The route with the highest O&D traffic is the flight between Ho Chi Minh and Los Angeles, with 300,300 passengers.

The TSA and FAA have yet to license Vietnamese carriers to operate scheduled direct flights to the United States. the carrier established a representative office in San Francisco in the early 2000s to develop a sales system and access local customers.

It also began working with a number of US airlines, including American Airlines and Delta Air Lines, to expand its reach in the market. Simultaneously, Vietnam Airlines has endeavored to strengthen the safety and security requirements as well as the quality of service, coordinating with local and international organizations and partners to carry out the relevant processes.

A Bamboo Airways 787 departs Hanoi on its inaugural flight to the United States (Photo: Bamboo Airways)

Various permits from US agencies such as TSA, FAA, Department of Transportation, United States Customs and Border Protection (CBP), International Revenue Service (IRS), Animal and Plant Health Inspection Service (APHIS) and the National Transportation Safety Board (NTSB) are required for scheduled flights. This is in addition to certain approvals from San Francisco International Airport authorities and US state business administration agencies.

With its more demanding criteria, the TSA is one of the most difficult mountains to climb. Before going any further, he would send specialists to Vietnam to inspect the airports. The FAA will rely on authorization from the TSA to license Vietnamese airlines. Vietnam Airlines has completed all the necessary documents and procedures for TSA approval.

There is currently no direct flight connecting the two nations, and therefore, passengers wishing to travel between the two nations must transit through Hong Kong, Korea or Taiwan, among other options, resulting in a total travel time of d ‘about 20 hours, whereas a direct flight would reduce the journey time to 15-16 hours. Vietnam Airlines and Bamboo Airways both have qualifying planes for direct flights to the United States. Vietnam Airlines has a fleet of around 30 wide-body aircraft, with 14 Airbus A350s and 15 Boeing 787-9s. Bamboo Airways, meanwhile, owns three Boeing 787-9s.

According to a representative of the Vietnam Civil Aviation Authority, the current fleets of Vietnam Airlines and Bamboo Airways, which include Boeing 787-9 Dreamliner and Airbus A350 XWB, will not be able to fly directly to the United States at full capacity – over 300 seats. . The Boeing 777X and the Airbus A350-1000 are required for long-haul and direct flights, but the two airlines do not have such planes, he added. In addition to the technological difficulties, analysts question the viability of direct flights between Vietnam and the United States.

However, there are concerns about profitability due to the low-yielding nature of the market and the length of the flight. In a 2019 filing, Vietnam Airlines announced that it was forecasting losses of $ 54 million in the first year on a hypothetical Ho Chi Minh City to Los Angeles route. Likewise, in 2018, Vietnam Airlines CEO Doung Tri Thanh said that “Vietnam Airlines could face an average annual loss of $ 30 million in the first five years of operation if we open a direct route. to the United States “.

US airlines have experienced the same difficulties as Vietnamese airlines today and have long ceased direct flights between the two countries. United Airlines started a direct service in 2007 but ended it in 2012, while Delta Air Lines only had a six-month direct service in 2008. Since then, no US airline has launched a direct flight. .

Additionally, Vietnam Airlines predicts a 75% drop in revenue from pre-pandemic levels in 2021, following a loss of around 7 trillion dong ($ 307 million) in the first half of 2021. Nonetheless, potential freight revenues and profits could offset or even balance out. loss of passenger income. Additionally, the common carrier admitted in an interview with Reuters in 2018, “The company’s philosophy is to help the economy and try to be viable and profitable… You can see on most intercontinental routes that we are not making money. But we do help get people in and out.

In 2020, Vietnam Airlines operated twelve repatriation flights to Houston, San Francisco and Washington Dulles, using a mix of its fleet of Boeing 787-10 and Airbus A350-900. In the summer of 2021, Vietnam Airlines re-launched its repatriation efforts to the United States, operating flights to Washington Dulles, San Francisco and Dallas, using its Boeing 787-9.

This article was written by Putu Deny Wijaya and Winston Shek for Airlinegeeks.



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