Jetstar Pacific & VietJet Air pursue more rapid international expansion with Singapore & Seoul

Vietnam's two low-cost carriers, Jetstar Pacific and VietJet Air, are slowly starting to penetrate Vietnam's international market. On 24-Jul-2014 VietJet launched Seoul as its third international destination while Jetstar Pacific is launching services in Oct-2014 to Singapore, which will become its second international destination.

VietJet and Jetstar Pacific have until now focused on the domestic market, driving up Vietnam's domestic LCC penetration rate to nearly 40%. Vietnam's international market in comparison has an LCC penetration rate of only about 14%, with foreign LCCs accounting for almost all of the capacity. This contrasts with the overall Southeast Asian LCC penetration level of over 40% including about 60% on routes within the region.

VietJet's new Hanoi-Seoul service is only the second LCC route linking Vietnam with North Asia. Ho Chi Minh-Singapore is Vietnam's largest international route and the entrance of Jetstar Pacific indicates a potential strategic shift at parent Vietnam Airlines, which until now has been reluctant to use its LCC brand on international routes it already serves with its full-service product.