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Vietnam Airlines Denies Bankruptcy Rumors Amid Huge Losses

Vietnam's national flag carrier, like the majority of airlines around the world, continues to face immense financial difficulties due to the pandemic.

The Saigon Times reports that Vietnam Airlines recently disclosed huge losses through the first nine months of the year. Accordingly, the airline lost US$463 million from January to September, while rumors have swirled that the carrier filed for bankruptcy. 

VNA has said that this is not the case, but in that same time period, the company's consolidated revenue equaled just 41.7% of the figure from the same period in 2019. 

Trần Thanh Hiền, head of VNA's Finance and Accounting Department, shared that the airline needs to ensure sufficient capital in order to continue operating. To that end, over the summer, it asked the government, which holds a majority stake in the company, for VND12 trillion in aid. 

Hien further elaborated that the carrier has saved over VND5.3 trillion by cutting salaries, restructuring loans, negotiating for extended payment deadlines. 

VietnamNet adds more from VNA's Tuesday press conference in Hanoi, with Hiền noting that their third-quarter revenue was only 32% of 2019's third quarter, and this usually one of the peak travel periods for Vietnam. 

"The aviation industry is in an extremely difficult time. Around the world, many airlines have to sell their assets," he said. "We are proactively seeking and taking advantage of every opportunity to increase revenue, such as promoting cargo transportation and charter flights to carry Vietnamese passengers back home and expert visitors, and selling old aircraft." 

The Vietnam Airlines Group, which also includes Pacific Airlines and VASCO, has maintained a majority share of the domestic aviation market, at 51.7%, and transported almost 12 million passengers through September. The ongoing suspension of commercial inbound international flights, however, is seriously hurting these airlines.

[Photo via Vietnam Airlines]