Viet Nam demands more airlines in region
Viet Nam demands more airlines in region
Low fuel prices and budget airlines have helped the new Filipino and Vietnamese middle-class fly in ever-greater numbers within Southeast Asia.
According to the most recent survey of FT Confidential Research of 3,000 consumers in Viet Nam, Indonesia, Malaysia, the Philippines and Thailand, the number of Vietnamese who fly rose from 62.3 per cent to 68.2 per cent in the past three years.
Meanwhile, the number of Filipinos who fly in the region rose from 63.5 per cent in 2013, to 77 per cent in 2015.In contrast, as the first chart shows, the number of respondents in Indonesia, Malaysia and Thailand who fly has been mostly flat over the past year, reflecting weak consumer sentiment amid slowing growth. However, the demand did jump sharply the year before in Indonesia and Thailand, which are both less mature markets for air travel than Malaysia.
FT Confidential Research, a unit of the Financial Times, expects that the recently-launched ASEAN Open Skies agreement will result in increased competition and lower prices for consumers, which will encourage more travel within the region.
The agreement, which stems from the framework for the ASEAN Economic Community, allows airlines from the group's 10 member states to fly freely within the region. Low-cost carriers offer the cheapest and quickest way to get across the region, where major population centres are separated by large bodies of water.
In Viet Nam, the national flag carrier Vietnam Airlines, which has 87.7 per cent ownership by the Vietnamese Government, remains the top choice.
However, Hanoi-based low-cost carrier VietJet is expanding fast on the back of an aggressive marketing campaign and is set to go public this year. A quarter of Vietnamese respondents said they most frequently fly on VietJet within ASEAN.
Malaysia and Thailand have recently expanded their hubs. Jakarta's main airport is also over capacity but the state plans to begin building a new runway next year. Viet Nam is expanding its airports in HCM City, Hue and Da Nang.
Airlines are also struggling with a shortage of well-trained pilots and several have had to set up their own training schools.
