Vietnam’s richest man makes smart decision to scrap his Vinpearl Air project

On January 11, China officially announced the first death from coronavirus and Vietnam’s Vingroup announced to scrap its private air carrier Vinpearl Air that shocked the business community.

Aviation sector has been hardest hit by the spreading coronavirus pandemic that is bringing down economies. With travel ban, Vietnam’s aviation sector could suffer initial losses of more than VND30,000 billion ($1.24 billion).

The virus costs the national flag carrier Vietnam Airlines’ asset that it had accumulated in five years. There have been 40 spare jets in parking lots, and 20,000 workers are also affected from the crisis, said Duong Tri Thanh, CEO of carrier.

Budget carrier Vietjet said its revenue decreased by half in the first quarter. In the future, Vietjet will have to reduce its staff salaries by 30%, cut working hours and increase online activities.

The newly launched Bamboo Airways of businessman Trinh Van Quyet has to delay plan to operate direct route to Europe.

Recently, the Airports Corporation of Vietnam said Bamboo Airways is constantly late in paying airport service fees and currently owes it VND205 billion ($8.8 million).

An airline in Vietnam has to pay 20 different fees such as for take-off and landing, flight management and parking to aviation managing authorities, including ACV. 

The state-owned company said in a recent report to the Ministry of Transport that this amount consists of payments for services such as security screening as of March 18, VnExpress says.

According to the Aviation Administration of Vietnam’s estimation, if the disease is controlled before April 2020, the market could transport 67 million passengers, down 15.4% compared to last year.

Of the amount, Vietnamese firms transported 12.7 million international visitors (down 28.3%) and 35.3 million domestic tourists (down 5.5%), the total transport only reached 48 million guests (down 9.2% over the same period).

This is not the first time the Vietnam’s richest man made "stop-loss" decisions. Late 2019, he shocked the business community with a decision to exit e-commerce sector by closing Adayroi and merging with VinID.

Earlier, he scraped Vincom Finance Group, Vincom Insurance, Vincom Bank, Vincom Securities.

Vuong, who had to leave the Top 200 richest people on the planet voted by Forbes, hired Dreamliner 787 to bring Ukrainians trapped in Vietnam due to coronavirus home.

► Vingroup scraps Vinpearl Air plan, withdrawing from aviation sector

► Vietnam’s richest man Pham Nhat Vuong off top 300 billionaires list

Source: Nha Dau Tu