National flag carrier Vietnam Airlines plans to form a cargo carrier as part of efforts to shore up its business that has been hard hit by Covid-19 outbreaks.
The carrier has converted seven passenger planes into cargo carriers – five wide-bodied Airbus A350s and two narrow-bodied A321s, Vietnam Airlines chairman Dang Ngoc Hoa said at its annual shareholders’ meeting Wednesday.
In June, its cargo transport revenue, which normally accounts for 10 percent of the total, surpassed that of passenger transport.
According to Vietnam Airlines CEO Le Hong Ha, the airlines has considered establishing a cargo carrier for years, but the time was not considered opportune.
Over the past two years, and especially in recent months, cargo transport has generated bigger revenues, so Vietnam Airlines is considering the plan more seriously, Ha said.
Chairman of retail company Imex Pan Pacific Group, Johnathan Hanh Nguyen, has asked for permission to establish a cargo airline named IPP Air Cargo with an investment of $100 million, but the national aviation authority has informed the transport ministry that it will not recommend the establishment of any new carrier until 2022, given the pandemic situation.
Budget airline Vietjet has re-configured 4 Airbus A321s to transport cargo.
Meanwhile, foreign express delivery giants like DHL and UPS have increased flights and payloads to transport goods to Vietnam by air.
According to a transport ministry report sent to the government, the proportion of cargo transport in local airlines’ total revenues in one year amid the Covid-19 outbreaks tripled against the pre-pandemic period.
In the first half of this year, Vietnam Airlines racked up losses of some VND9.823 trillion (nearly $427.1 million). It has estimated consolidated losses of VND14.526 trillion this year, up nearly 30 percent against last year, and consolidated revenues of nearly VND37.4 trillion, down 11.6 percent.