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New Route Gives Vietnam Airlines Foothold in Germany

Posted on: Sunday, 17 July 2005, 12:00 CDT

Excerpt from report in English by Vietnamese radio text website on 17 July

Vietnam Airlines launched direct air links between Hanoi, Ho Chi Minh City and Frankfurt of Germany on 4 July. Each week, the national flag carrier conducts two flights from Hanoi to Frankfurt on Mondays and Thursdays, and another one from Ho Chi Minh City to Frankfurt on Saturdays. The inauguration of the non-stop flights between Vietnam and Frankfurt will help boost political and economic cooperation and development between the two countries.

While several Southeast Asian countries are losing their market shares to European visitors, Vietnam has emerged as an attractive destination for these visitors, particularly those from Germany. Before 4 July, no world airliners had established direct flights between Germany and Vietnam and this is a good chance for Vietnam Airlines to penetrate this potential market.

By launching direct flights to Frankfurt, Vietnam Airlines gains an advantage over its rivals such as Thai Airways International, Singapore Airlines and Air France because they make a stopover en route from Vietnam to Germany and vice versa. By taking direct flights to Frankfurt, passengers will save between three to five hours on their itinerary and they will not have to make transit procedures at a third airport, thus reducing the risk of losing baggage.

Experts said both Vietnam and Germany have great potential for developing air-born travel. Last year, the number of passengers travelling by air between the two countries reached 68,000 and the figure is expected to rise to 76,000 in 2005. Germany ranks second after France in Europe in terms of the number of its visitors to Vietnam, with an annual average growth rate of 10 per cent.

Western Europe, Northern Europe and Eastern Europe are Vietnam's potential markets. Vietnam has already established direct flights to Paris and Moscow while flights to other European cities experienced at least one or two stopovers. [passage omitted]

In addition, cargo transportation by air between Vietnam and Frankfurt has increased significantly in recent years. Vietnamese commodities to Frankfurt include garments and textiles, leather and footwear, chinaware, fruits and vegetables, while commodities from Frankfurt to Vietnam include garment accessories, machinery equipment and chemicals.

So far, goods have been mainly transported by Lufthansa Airlines, Air France, Thai Airways International and Singapore Airlines. Currently, Vietnam Airlines holds only 20 per cent of the regional market share.

Vietnam Airlines faced numerous challenges when it opened a direct air route to Frankfurt due to fierce competition in the market. However, the airline has many advantages in both flight frequency and airfare compared to other airlines, which also conduct flights from Vietnam to Germany and vice versa. In addition, Thai Airways International and Singapore Airlines are allowed to conduct code-sharing flights of Lufthansa Airlines' domestic network. [passage omitted]

Currently, Vietnam Airlines' representative office in Germany has established a wide marketing network to lure more customers, and in the near future the carrier will increase the number of flights to other destinations in Germany. [passage omitted]

Source: BBC Monitoring Asia Pacific

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