Earlier this week, Aer Lingus announced that it will begin a new nonstop service from Dublin, Ireland to Cleveland, Ohio.…
Vietnam Airlines vs. Bamboo Airways: The Quest to Launch Direct Flights to the US
Vietnamese flag carrier Vietnam Airlines and newer local competitor Bamboo Airways are scrambling to finish processes to get permission from U.S. agencies to begin running scheduled direct flights to the U.S.
On Saturday, Vietnam Airlines filed permanent commercial flights from Ho Chi Minh City to San Francisco, paving the way for the first permanent nonstop connection between the United States and Vietnam. These flights will operate twice a week on Sundays and Wednesdays from Nov. 28, utilizing the carrier’s Airbus A350-900, per theaeronetwork.
Last month, the Hanoi-based carrier received Transportation Security Administration (TSA) approval to operate scheduled commercial operations from Vietnam to the U.S., leaving Federal Aviation Administration (FAA) regulatory approval as its final obstacle before adding service to the U.S. In August 2019, Vietnam Airlines received Department of Transportation approval 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.
The Skyteam carrier’s inaugural commercial flight to the U.S. will be operated with a Boeing 787 Dreamliner, though it is unclear 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 leg, Vietnam Airlines Flight 99 departs San Francisco at 10:00 p.m. and arrives in Ho Chi Minh City at 6:40 a.m., two days ahead of the initial departure.
Currently, these flights are filed through the end of March 2021, per schedule data from their website. Additionally, as of the time of writing, these flights are not available for reservation.
In August, in an interview with Bloomberg, Vietnam Airlines CEO Le Hong Ha detailed that flights between Vietnam and the United States would rely on cargo demand to offset initial weak passenger demand. He added that the route would include a refueling stop, though this is not reflected in the current schedule offering.
According to RoutesOnline, data from Sabre indicates that the O&D – Origin and Destination- traffic between the United States and Vietnam totaled 1.77 million passengers in 2019, with 198,000 passengers flying the Ho Chi Minh City to San Francisco route. The route with the highest O&D traffic is the flight between Ho Chi Minh and Los Angeles, with 300,300 passengers.
An Intensive Process
The TSA and the FAA have yet to provide licenses to any Vietnamese carriers to operate regular direct flights to the U.S. The two airlines are now competing to be the first Vietnamese carriers to create a direct, regularly scheduled connection to the U.S. According to Vietnam Airlines, the carrier established a representative office in San Francisco in early 2000 to develop a sales system and get access to local clients.
It has also started working with a number of US airlines, including American Airlines and Delta Air Lines, to broaden its market reach. Simultaneously, Vietnam Airlines has worked to strengthen security and safety requirements as well as service quality, coordinating with local and international organizations and partners to complete relevant processes.
Various permits from U.S. component agencies such as the TSA, FAA, Department of Transportation, U.S. Customs and Border Protection (CBP), the International Revenue Service (IRS), the Animal and Plant Health Inspection Service (APHIS) and the National Transportation Safety Board (NTSB) are required for regular flights. This is in addition to certain approvals from authorities of San Francisco International Airport and business administration agencies of states of the U.S.
With its more stringent criteria, the TSA is one of the most difficult mountains to climb. Before moving further, it would send specialists to Vietnam to inspect airports. The FAA will rely on the TSA’s clearance to award Vietnamese airlines a license. Vietnam Airlines has completed all of the necessary paperwork and procedures for TSA approval.
A Difficult Dream to Achieve
There are presently no direct flights connecting the two nations, and as a result, passengers wishing to fly between the two nations must transit through Hong Kong, Korea or Taiwan, among other options, resulting in a total journey duration of around 20 hours, whereas a direct flight would reduce the trip time to 15-16 hours. Vietnam Airlines and Bamboo Airways both have aircraft that are eligible for direct flights to the U.S. Vietnam Airlines has a fleet of roughly 30 wide-body aircraft, with 14 Airbus A350s and 15 Boeing 787-9s. Bamboo Airways, on the other hand, owns three Boeing 787-9s.
According to a representative from Vietnam’s Civil Aviation Authority, the current fleets of Vietnam Airlines and Bamboo Airways, which include Boeing 787-9 Dreamliner and Airbus A350 XWB aircraft, will not be able to travel straight to the U.S. at full capacity — over 300 seats. The Boeing 777X and Airbus A350-1000 are needed for long-haul and direct flights, but the two airlines do not have such planes, he added. Aside from technological difficulties, analysts have questioned the viability of direct flights between Vietnam and the United States.
However, there are concerns over profitability due to the low yielding nature of the market and the length of the flight. In a 2019 filing, Vietnam Airlines posted that it anticipates first-year losses of $54 million on a hypothetical Ho Chi Minh City to Los Angeles route. Similarly, in 2018, Vietnam Airlines CEO Doung Tri Thanh expressed 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 U.S.”
American airlines have suffered the same difficulties that Vietnamese airlines are encountering now, and have long since ceased direct flights between the two nations. United Airlines started a direct service in 2007 but ended it in 2012, whereas Delta Air Lines only had a six-month direct service in 2008. Since then, no U.S. airlines have launched a direct flight.
Additionally, Vietnam Airlines anticipates a 75% drop in revenue from pre-pandemic levels in 2021, after a loss of about 7 trillion dong ($307 million) in the first half of 2021. Nonetheless, potential cargo revenue and profit could offset or even out the losses from passenger revenue. Additionally, the state-owned carrier admitted in an interview with Reuters in 2018, “The philosophy of the company is to help the economy and try to be viable and profitable… You can see on most of the intercontinental routes we are not making money. But we are helping to get people in and out.”
In 2020, Vietnam Airlines operated twelve repatriation flights to Houston, San Francisco and Washington Dulles, utilizing a mix of its fleet of Boeing 787-10 and Airbus A350-900. During the summer of 2021, Vietnam Airlines reinitiated repatriation efforts to the U.S., operating flights to Washington Dulles, San Francisco and Dallas, using its Boeing 787-9.
- Garuda, Citilink To Double Number of Airplanes by End of Year - September 6, 2022
- Demo Flight Gone Horribly Wrong: The 2012 Mount Salak Sukhoi Superjet Crash - July 8, 2022
- Five Iconic Indonesian Airlines That Eventually Went Bankrupt - June 10, 2022
This past weekend saw Air New Zealand launch nonstop flights from Auckland to New York City, ushering in nonstop service…
On Wednesday United Airlines and Emirates officially announced their new codeshare agreement at an event hosted in United’s hangar at…