Budget airlines benefit Vietnamese passengers

Friday, Aug 15, 2014 18:33

Low-cost VietJet Air and Jetstar Pacific are offering promotions for domestic and international flights. More Vietnamese travellers have benefited from using these budget airlines. — VNS Photo
HA NOI (Biz Hub) — With the launch of budget airlines in recent years, more and more Vietnamese travellers have been benefiting from booking tickets well in advance to secure low-cost air fares.

Air travellers could collectively save VND9 trillion (over US$428 million) this year by using budget airlines, if each traveller saved on average VND500,000 ($23.8) per flight, representative from a private airline who declined to be named said.

 

The Vietnamese government is keen to further encourage both the State-owned and private sectors to make further savings on travel costs that can help shore up the national economy.

In directive 38-CT/TW regarding the "management of overseas business trips", the Politburo suggested that those who were sent on overseas business trips should try to save on transportation costs and take advantage of budget airlines.

Considering the geography of Viet Nam with so many large economic hubs long distances apart, significant savings can also be made on domestic flights by flying with low cost carriers, she said, adding that for businesses with executives or employees travelling frequently between cities in Viet Nam, or overseas, saving VND500,000 to VND1 million ($47.6) per flight can add up over the course of a year.

"My job requires me travel a lot. In the current difficult context, flying with low-cost carriers helps me reduce business expenses. For example, for a one-way ticket from Ha Noi to Singapore or Thailand, I have to pay additional VND1-2 million ($47.6-95.2) if I travel with non-budget airlines," Mai Anh, a marketing director at a HCM City-based company said.

For many travellers, only the explicit benefits of budgets airlines, such as cheap tickets, may be obvious. There are also "visible advantages" of saving on air travel.

"You spend less on your ticket so you can spend more on your holiday, or stay in your holiday destination for longer," Hoang Ha, a loyal passenger of low-cost airlines for several years.

According to economists, the more we reduced on transport costs, the more businesses in all industries would benefit from our extra spending power as well as extra investment or the more passengers travel around the country or overseas.

It was reasons why budget airlines were now strongly favoured all around the world particularly since the global downturn has led to many governments world-wide placing an emphasis on austerity and businesses realising the importance of trimming budgets.

Outside of Viet Nam, in neighbouring Southeast Asian countries, the market is dominated by low-cost carriers such as Lion Air (Indonesia), Air Asia (Malaysia), Nok Air (Thailand) and Tiger Air (Singapore). Regionally low cost carriers account for 65-70 per cent of the domestic market share. In Viet Nam, the market share of budget airlines is more modest at just over 30 per cent. — VNS

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