VietJet is rapidly expanding its fleet and preparing for direct flights to California by 2019.
According to Bloomberg, VietJet, Vietnam’s largest private airline, is planning to begin flights to America in 2019, starting with services to San Jose. All plans are pending permission from the US Federal Aviation Administration.
The expansion reflects VietJet’s increased focus on international routes. Nguyen Thi Phuong Thao, VietJet’s founder and chief executive officer, shared that she aims to boost the carrier's international flights to 60% of its business.
The budget airline’s international capacity has soared by more than 150% in the past year from just 130 overseas flights a week to more than 400. South Korea and Taiwan have emerged as VietJet’s strongest international markets. VietJet recently became the largest airline present in the Vietnam-Taiwan market, and will soon become the largest foreign low-cost carrier in South Korea, according to the Australia-based Centre for Aviation.
While Vietnam's domestic air travel market has tripled in size in the last five years, fueling VietJet’s rapid expansion, sustained growth will require looking outside the country. “A lot of these people who have become first-time fliers in the last five years will be able to travel overseas as they build discretionary income,” Brendan Sobie, a Singapore-based analyst at the Centre for Aviation, told Bloomberg.
VietJet will face tough competition when expanding into the crowded field of carriers serving flights to America. Vietnam Airlines, Vietnam's national carrier, has also announced route to Los Angeles by late 2019 or early 2020.
Thao hopes to establish a position in the market by taking advantage of regional airports in places with large Vietnamese populations in localities like San Jose and Orange County. “We are looking at airports where there is a demand but not many airlines flying there,” she said.
To accommodate the trans-pacific flights, VietJet is considering expanding its fleet to include wide-body jets, an addition to bringing in new additions to its current lineup of narrow-body jets. Last year, the budget carrier ordered 100 Boeing 737 Max 200 aircraft with a price tag of US$11.3 billion. It also agreed to buy 30 A321s in 2015, as well as 100 Airbus planes a year earlier.
On the occasion of the APEC 2017 summit, on Sunday, VietJet held a signing ceremony to announce a US$600 million deal to acquire ten engines from US-based Pratt & Whitney, according to a company press release. This latest deal is in addition to a US$6 billion contract signed earlier this year for 215 engines.
[Photo via Vietnam in Your Pocket]
