Vietnam’s aviation industry is rapidly gaining momentum with large-scale developments, resulting in preparations for the infrastructure and safety – and ultimately the future of air travel – for those flying into and out of Vietnam. By Ruben Luong. Photo by Vinh Dao.
Last year commercial aviation turned 100. In 1914, one aircraft flew with one passenger on one route, but in 2014, at least 3.3 billion passengers and 52 million tonnes of cargo were transported, according to the president of the Geneva-based International Air Transport Association (IATA) Tony Tyler, who highlighted this milestone at an event for Vietnam Aviation Day in Hanoi.
“Vietnam is more prosperous because of aviation,” he added during his speech. “Including tourism, aviation contributes USD $6 billion to Vietnam’s GDP and supports over 230,000 jobs. It gives access to global educational and cultural opportunities and connects families over long distances. Aviation connectivity is also providing local firms with access to global markets, and is an important driver of foreign direct investment in Vietnam.”
These days it’s easy to see there is plenty of investment and development taking place on the ground in Ho Chi Minh City. Last month, construction of the four-floor underground section of the first metro line station at Le Loi and Nguyen Hue Streets began. An 86-story observation tower in the Thu Thiem New Urban Area will eventually become the tallest skyscraper in the city, standing 18 stories taller than the Bitexco Tower.
But not quite as apparent are the unprecedented developments happening in the skies above the city. Vietnam’s aviation market is forecast to be the world’s seventh fastest-growing during the 2013-2017 period, with annual growth rates of 6.9 percent and 6.6 percent expected for international passengers and freight, respectively, according to IATA.
The aviation industry here is poised for rapid growth and positive advancement – Vietnam Airlines was finally able to announce its IPO last year and expects to acquire the world’s most advanced aircraft next year, for instance. Continued development of the aviation industry is no doubt critical for the country’s economy, and the industry is preparing to balance this pressure for growth and accommodate the huge influx of domestic and international travellers that lies ahead while maintaining high aviation standards.
IATA finds that between 2008 and 2013, passenger traffic has almost doubled in Vietnam, and last year Vietnam announced an ambitious aviation masterplan of having 26 airports by 2020. Although it may not be completed until 2023, the construction of the international Long Thanh Airport 50 kilometres from HCMC seeks to prevent the overloading of 25 million passengers at Tan Son Nhat that is expected in 2017.
According to CAAV, there were big investments poured into upgrading infrastructure and facilities recently. Last month, Noi Bai opened a new, second terminal, which is four storeys and can serve 10 million passengers a year.
Tyler also validated the CAAV’s sentiment on Vietnam Aviation Day. “The availability of infrastructure is critical to support the growth of the aviation industry,” Tyler remarked. “Vietnam ranks 82nd in the Infrastructure Index of the World Economic Forum’s Global Competitiveness Report. Among the 10 Asean states, Vietnam is ranked sixth. It is encouraging to see that the Vietnamese government has made it a priority to improve.”
This is becoming more essential as local airlines and low-cost carriers become more competitive with each other, fares become cheaper, new technology and aircraft are adopted and new routes open up, providing greater visibility and positive business for Vietnamese aviation in the global market. According to CAPA Centre for Aviation, VietJet Air is looking to expand its fleet so that it can fly to Indonesia, Malaysia, Japan and Russia while Jetstar Pacific will focus on North Asia this year. CAPA also states that Phu Quoc’s international airport, which has seen a boom in tourism, is now Vietnam’s fifth largest airport, rising four spots since it opened in late 2012 with a seat capacity that has more than doubled over the past two years. Moreover, more connectivity is being seen, as VietJet Air launched its maiden flight to Taipei last month while JetStar Airways and Vietnam Airlines opened a Ho Chi Minh City and Mumbai/New Delhi route in November.
“Aviation is an industry with tremendous potential,” Tyler said. “Asia-Pacific is leading the industry’s growth. But there will be challenges to become ever safer, to provide cost-efficient infrastructure.”