VNDIRECT RESEARCH
AVIATION: FASTEN YOUR SEATBELT AND PREPARE FOR TAKEOFF
Analyst(s): Dzung Nguyen dung.nguyentien5@vndirect.com.vn
Almost full preparation for skies reopening A few pilot plans to reopen domestic and international flights in 4Q21F With the improving vaccination coverage, in mid Sep-2021, Ministry of Transportation (MOT) has submitted the plan to resume domestic air traffic to the government with four specific stages. Currently, Vietnam aviation is in phase 3 of the plan in which the frequency on each route for each airline does not exceed 30% of the average of the first 10 days of Apr-2021 for that airline. Following the plan, Vietnam domestic air traffic may come back to normal operations in Dec-21. For the international air traffic, most recently, CAAV has submitted the plan to resume international air traffic following four stages:
Figure 180: Plan to resume international air traffic Stage 1 Time frame In 4Q21 - To cities where pilot the international travel package program (Phu Quoc, Ha Long, Hoi An, Nha Trang, Da Lat). - One flight per route per day in Nov-21, two flights per route per day in Dec-21. Details
Stage 2
Stage 3
Stage 4
01/01/2022 - 31/03/2022 - Reopen regular routes to big cities such as Ha Noi, Ho Chi Minh city, Da Nang.. - Four flights per route per week. - Passengers are required to be fully vaccinated after 14 days since the day of injection and has valid certificate of negative test results for Covid-19. - Post-entry quarantine required.
01/04/2022 - 30/06/2022 - Reopen regular routes. - Seven flights per route per week. - "Vaccine passport" required. - No post-entry quarantine required.
From 01/07/2022 - Back to normal operations
Source: CAAV, VNDIRECT RESEARCH
In order to restart the international air traffic, the government has agreed on a pilot plan to welcome foreign tourists with vaccine passports to Phu Quoc, Ha Long, Hoi An, Nha Trang… when these cities achieve sufficient vaccine coverage. Following the plan, Vietnam international air traffic may come back to normal operations since 3Q22. We expect Vietnam aviation to strongly recover from 2022F onwards With particular plans in resuming the domestic and international air traffic, together with recent positive signs in controlling the pandemic and improving vaccination coverage nationwide, we expect Vietnam domestic and international air traffic may gradually recover from 4Q21/1Q22F, respectively. Due to the severe effects of the 4 th pandemic outbreak, Vietnam total domestic pax may drop 43.9% yoy and total international pax may drop 85.7% yoy in FY21F. Figure 181: Vietnam domestic passenger traffic in FY19-21F
Source: VNDIRECT RESEARCH, COMPANY REPORTS
www.vndirect.com.vn
Figure 182: Vietnam international passenger traffic in FY19-21F
Source: VNDIRECT RESEARCH, COMPANY REPORTS
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