Local airlines grapple with soaring costs amid Russia-Ukraine conflict

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The Russia-Ukraine military conflict has caused a significant impact on the Vietnamese civil aviation sector, with carriers struggling to cope with soaring costs, according to the Civil Aviation Authority of Vietnam.

Local airlines grapple with soaring costs amid Russia-Ukraine conflict

In a report on the impact of the Russia-Ukraine crisis on the local aviation sector sent to the Ministry of Transport, CAAV said that the crisis had caused a profound, comprehensive and negative effect on the local economy, including the aviation sector.

The crisis has led to the European Union, the United States, the United Kingdom and Canada closing their airspace to Russian planes, while Russia has taken similar action against these countries, the local media reported.

Dinh Viet Son, deputy head of CAAV, said these moves had directly affected Vietnamese passengers and airlines as they had to change flight schedules, while problems with insurance, payments and risk provisions had arisen, resulting in flight costs rising.

The ban on air traffic through Russian airspace has dramatically affected the operations of Vietnam Airlines and Bamboo Airways, which are operating flights to Europe and the United States using transit routes through Russia.

In particular, the routes of flights to and from Europe needed to change. They must fly via China, Kazakhstan or North Africa to avoid Russian airspace.

The flight time is expected to increase by 60-120 minutes per flight, hence a rise of US$10,600-21,200 per flight.

Vietnam Airlines has been operating six weekly flights between Vietnam and Europe, so its costs have risen by US$70,000-130,000 a week.

Meanwhile, Bamboo Airways has been running three weekly flights between Vietnam and Europe, and its costs have surged by US$35,000-65,000 per week.

Furthermore, the flight time has been extended by 20-30 minutes per flight.

Vietnam Airlines has been operating four weekly flights to the United States, so it must bear an additional cost of US$20,000-40,000 per week.

Moreover, the carrier cannot use airports in Russia. The insufficient fuel supply by Russia and Ukraine has also sent fuel prices up.

The higher aviation service cost has put pressure on global logistics systems and product prices.

As for the air route between Vietnam and Russia that Vietnam Airlines has suspended since March 25, nearly 80% of wide-body aircraft of the firm are chartered and the firm cannot operate the aircraft to areas subject to the United States’ and the European Union’s sanctions if the operation leads to violations of the charter contracts of the relevant parties.

Moreover, if aircraft face technical problems in Russia, Boeing and Airbus cannot support the airline.

CAAV always keeps a close watch on the developments of the crisis and is willing to support Vietnamese airlines in reopening international air routes, including those to Russia, when possible, Son said.

Source: Saigon Times

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