Lately, the airline has opened a new route to India and is preparing the necessary conditions to immediately reopen flights to China, Myanmar, and Russia when the conditions permit.
The national carrier is expected to resume flights to Indonesia in July and key international routes to Japan, Korea, and Australia in November at the same flight frequency as in 2019. It hopes that it will be able to restore the entire international flight network, equivalent to that in 2019 by the end of 2023.
The gradual restoration of international flight routes is an opportunity for Vietnam Airlines to improve the usage efficiency of resources, increase revenue, improve production and business results, reduce losses, and aim at profits in the following years.
In 2021, the total consolidated revenue of this enterprise was only VND29.75 trillion. However, the consolidated pre-tax loss was VND1.34 trillion lower than the forecast. Before the Covid-19 pandemic, international regular flight routes accounted for 65 percent of the airline’s revenue.
According to Dang Ngoc Hoa, Chairman of the Board of Directors of Vietnam Airlines, the carrier currently holds a 98 percent stake in Pacific Airlines. At present, this airline is facing a cash-flow shortage, large overdue debts, and a risk of insolvency and shutdown.
Following the policy approved by State agencies, the Board of Directors of Vietnam Airlines had directed the implementation of solutions to maintain the airline’s operations while looking for new investors to participate in the restructuring of Pacific Airlines.
Vietnam Airlines worked with relevant agencies and potential investors. However, the investor selection process encountered many difficulties related to mechanisms and policies according to current regulations for State-owned enterprises. Because of the accumulated losses of Pacific Airlines, the transfer of losses was entangled with regulations and implementation procedures.
Vietnam Airlines will report to the competent authorities to apply regulations to select investors publicly, transparently, and compliantly with the law, ensuring the harmony between the Law on Enterprises and the Securities Law.
Pacific Airlines was established in 1991, with shareholders being State-owned enterprises.
In 2007, Qantas Group bought a 30 percent stake in Pacific Airlines, and the airline changed its name to Jetstar Pacific Airlines.
In 2012, the State Capital Investment Corporation (SCIC) transferred 68 percent of the capital at Jetstar Pacific to Vietnam Airlines.
By July 2020, Jetstar Pacific changed back to its first name – Pacific Airlines.
In October 2020, Qantas Group carried out procedures to withdraw from the partnership at Pacific Airlines and transferred 30 percent of its shares in Pacific Airlines to Vietnam Airlines in the form of gifting. Thus, Vietnam Airlines currently holds about 98 percent stake in Pacific Airlines.
By Bich Quyen – Translated by Da Nguyet
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