Vietnam Airlines losses soar as Covid-19 grounds flights

Vietnam Airlines has reported losses of VND10.7 trillion ($464 million) in January-September, hit hard by Covid-19. The national flag carrier recorded revenues of VND23.9 trillion in the first nine months of this year, down 58.3 percent year-on-year, it said in a press release on Tuesday.

During this period, the carrier transported 10.2 million passengers, down 41.2 percent from a year ago.

The airline has blamed its loss on the pandemic’s impacts on the aviation industry. It said it has cut sales, financial and management expenses, reduced salaries of pilots and flight attendants as well as increased the operation of repatriation flights as part of efforts to reduce costs and boost incomes.

The carrier’s third-quarter revenues fell 68 percent year-on-year after the second Covid-19 outbreak hit the country in late July, said Tran Thanh Hien, the airline’s chief accountant. The third quarter was usually the highest revenue earner of the year as summer travel peaked, Hien noted.

The second outbreak forced Vietnam Airlines to cancel 22 new domestic routes during the peak period. So far, it has resumed 11 of these and is considering the viability of resuming the rest in the fourth quarter, always a low travel period.

The national carrier currently operates more than 60 domestic routes with an average of 300 flights per day. It has resumed one-way flights to Japan and plans to reopen routes soon to mainland China, Taiwan, Laos, and Cambodia.

As of last month, the airline said its cash reserves had gone down to just VND1.9 trillion.

The airline has estimated this year’s total loss at around VND15.2 trillion on revenues of VND55.7 trillion.