Pioneering the International Market
Vietjet has reported a remarkable increase of international passengers at 3.5 million in the first half of 2023, accounting for more than 50% of the total 6.9 million international passengers to and from Vietnam. It has become a bridge for global trade, investment, tourism, and cultural exchange.In the second quarter of 2023, the airline opened 11 new international routes to Australia, Indonesia, and India, expanding its flight network to 120 routes (of which 75 are international and 45 are domestic). This has made air travel the most convenient, cost-effective means of transport for individuals and businesses between Vietnam, the Southeast Asian region, and major international markets such as Australia, India, Kazakhstan, Northeast Asia, and beyond.
Notably, Vietjet has aggressively expanded its network to India which is home to over 1.4 billion people, operating seven routes connecting Hanoi and Ho Chi Minh City with the four major Indian cities: Mumbai, New Delhi, Ahmedabad, and Kochi. Vietjet's entry into the market has increased the total number of passengers traveling between Vietnam and India in the first six months of 2023 to over 300,000—nearly five times higher than 70,000 passengers recorded in the same period last year.
Vietjet since mid-April has also opened three direct routes in a row from Ho Chi Minh City - Vietnam’s economic, cultural, and tourism metropolis - to the three largest cities in Australia: Sydney, Melbourne, and Brisbane. Prior to 2023, the annual passenger count on the Vietnam-Australia route averaged around 500,000. Following Vietjet's April launch, weekly passengers have doubled, paving the way for a projected total of over one million passengers by year-end. Additionally, the airline's fourth Australian route, connecting Ho Chi Minh City to Perth, is poised to launch in November.
In the Northeast Asian market, Vietjet has maintained a robust network with 14 routes to South Korea, eight to Taiwan, and seven to Japan. Moreover, it continues to expand its reach to encompass more than 50 destinations in mainland China. This continuous growth firmly solidifies Vietjet's status as a multinational airline and a prominent "air ambassador" within the global aviation industry.
Vietjet's international routes, with reasonable fares and high-quality services, have contributed to connecting cultures, bridging the geographical distance between Vietnam and Asia Pacific countries and bringing people in the region closer. They have also promoted tourism and strengthened bilateral investment and trade, further facilitating the economic recovery and development of the countries.
Embracing a strategy of back-to-back innovation, Vietjet has consistently introduced premium products and services. In the first half of 2023, the airline launched its Business class, offering numerous privileges to passengers, along with the SkyJoy loyalty program, which has already garnered over 8 million members. To further its commitment to sustainability, the airline has introduced a modern, environmentally friendly A330 aircraft fleet for flights to Australia, India, Kazakhstan, Japan, and South Korea.
Vietjet has actively contributed to the travel community by providing free flights and maintaining affordable tickets for the people and tourists in the region, living up to the airline’s philosophy that everyone can fly in a world where economies and cultures are brought closer than ever.
Achieving 120% of H1 target, revenue increases by 87%
In the first half of 2023, Vietjet achieved a consolidated revenue of VND29,770 billion (approx. US$1.25 billion) – a remarkable 87% YoY and surpassing the H1 target by 120%. Ancillary revenue played a significant role, contributing 40% of the total revenue, and doubling to VND9,000 billion (approx. US$378.68 million) compared to the previous year. The airline also achieved a consolidated after-tax profit of VND387 billion (approx. US$16.3 million).With a safety record encompassing 65,900 flights and the transportation of over 12.1 million passengers—representing a 30% year-on-year increase—Vietjet stands as a market leader in terms of passenger numbers on both domestic and international routes. The airline's fleet of 103 aircraft, including 7 wide-body aircraft, leverages its strategic orders with Airbus and Boeing to enhance operational efficiency and financial performance.
Vietjet has been focusing on sustainable aviation development to fly passengers on flights that are fuel-efficient while reducing CO2 emissions. Such is hoped to inspire more actions towards a green future, mitigating the impact of natural disasters and pandemics while bringing better values to the world.
The airline has used eco-friendly materials such as meal trays made from local bamboo and areca palm leaves. Vietjet has also accelerated the application of technology and digital transformation, moving towards paperless operations and streamlining processes to improve efficiency and minimise unintended environmental impacts.
As of June 30, 2023, Vietjet's total assets reached over VND71,500 billion (approx. US$3.01 billion) while the debt/equity ratio and the liquidity ratio were 1.2 and 1.5 respectively, which were all within good range of the aviation industry.
Vietjet has received a BB+ credit rating with a Stable outlook (VnBB+) from Saigon Ratings. It highly regarded Vietjet’s financial capabilities with solid capital structure, low debt ratio, and resourceful liquidity. Additionally, commercial advantage and diversified business platform helped Vietjet maintain its shareholder capital after the Covid-19 pandemic.
Being the largest passenger transporter of all airlines in Vietnam, particularly on international routes, Vietjet, based on its positive business performance in the first half of the year, is expected to achieve and even exceed its 2023 plan, continuing to contribute to the recovery and growth of tourism, investment, and the economy in general.
* Jill Ilao, Account Director, jillian@primarycommsgroup.com.auprimarycommsgroup.com.au
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