VietJet Air is looking to launch JVs in Myanmar, Cambodia and Laos following the signing of a MoU with Kan Air to establish Thai VietJet, according to Managing Director Luu Duc Khanh. As reported by Bangkok Post, the subsidiaries will be established "using Thai VietJet Air's 49:51 model" of ownership with a Myanmar subsidiary expected to be the carrier's next joint venture. Mr Khanh stated VietJet Air aims to increase its A320 fleet from eight to 20 aircraft in 2014 to accommodate subsidiary carriers.
VietJet Air looking to launch joint ventures in Myanmar, Cambodia and Laos
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China is not the only game in town: Asia’s other aviation growth markets
China captures headlines and imaginations in terms of market growth potential, and rightly so - it will generate 100 million tourists annually by the end of this decade. But there are other markets in Southeast Asia that show high potential and remarkable promise for future growth opportunities.
The large aircraft order book hovering over the region has attracted significant attention from the global industry in recent years. Much of this is directed at short haul markets, as new LCCs expand and regional commerce develops. While the rate of growth has been slowing, the order book suggests at some point the rate of LCC growth in Southeast Asia will re-accelerate. Southeast Asian LCCs currently have over 1,100 orders, including almost 90 widebody aircraft. LCCs currently account for about 75% of orders among Southeast Asian airlines but only about 33% of the active fleet. Even when factoring in replacements the size of the LCC fleet should more than double over the next decade.
Three Southeast Asian markets recorded double-digit passenger growth in 2015 – Thailand, Vietnam and Cambodia – while another three experienced high single-digit growth – the Philippines, Laos and Myanmar. Indonesia and Malaysia have struggled recently but should see faster growth rates again in the medium to long term. Indonesia, with its 200 million population, is perhaps the quiet medium term performer. Thailand and Vietnam, for now, remain the hottest markets in Southeast Asia. Myanmar is also intriguing, but much smaller.
SilkAir Part 2: Laos launch extends SIA Group ASEAN network to 42 destinations and all 10 countries
The Singapore Airlines (SIA) Group will in Oct-2016 become the second airline group after AirAsia to serve all 10 ASEAN countries. Laos is the last piece of the puzzle and will be served by SIA full service regional subsidiary SilkAir with a new thrice weekly Singapore-Vientiane-Luang Prabang-Singapore circle routing.
Following the launch of Luang Prabang and Vientiane, SilkAir will have 32 Southeast Asian destinations and the SIA Group will have 42. Connecting secondary markets in the fast growing Southeast Asian region is critical for SIA as it tries to unlock a new era of growth and differentiate itself from competitors.
This is Part 2 in a two part series of reports. The first part focused on expected growth in the Lao international market and how SilkAir is trying to benefit. This part will focus on how the launch of services to Laos is an important step in the SIA Group network strategy.