Student’s name: Trần Thanh Mai

Class: 18E16
Student’s card: 18040586

REPORT
VIETJET AIR AND COVID-19
Vietjet Air ( VietJet Aviation Joint Stock Company) is the first privately-owned low-cost airline in
Vietnam licensed to operate in 2007. Vietjet is one of the official members of the International Air
Transport Association (IATA) with IATA Operational Safety Audit. Currently, Vietjet Air
operates an average of 385 flights per day and carries more than 65 million passengers with
domestic routes covering all over Vietnam and international routes to Japan, South Korea,
Singapore, China and so on. Over 10 years of construction and development, Vietjet is
increasingly affirming its position.

Covid -19 pandemic has considerable impact on aviation. Airlines in Vietnam have to face
a lot of difficulties which include cancelation of flights and international flight ban and Vietjet Air
is not an exception. Like many other airlines, Vietjet also suffers a strong impact from pandemic
when travel demand decreases and international flight bans were applied. In 2020, Vietjet only
operated 78,462 flights with 120,093 safe flight hours and carried more than 15 million passengers.
The number of flights and passengers decreased sharply compared to 139,000 flights and
approximately 25 million passengers in 2019. According to a report in the 4th quarter of 2020,
Vietjet recorded more than 4,429 billion dongs of revenue from sales and service provision which
is decreased 68,1% compared to the same period in 2019. In which, revenue from passenger
transportation was only 1/5 one in the same period, reaching 1,097 billion. Other revenue from
ancillary activities, ownership transfer, and aircraft trade all decreased sharply compared to the
fourth quarter in 2019.

Facing many difficulties and challenges during the pandemic, Vietjet imposed a lot of
measures to minimize the severe effect of the Covid-19 pandemic. The first solution of Vietjet is
launching Vietjet’s ground services at Noi Bai international airport. Vietjet’s ground services help
Vietjet improve quality, service, synchronize brand identity, and manage operating costs well,
especially contribute to cost reduction and increase in ancillary revenue at airports. The second
solution is given by Vietjet to cope with the pandemic is reserving petroleum. In the first six-month
in 2020, world gasoline prices bottomed at 25 USD per barrel. Vietjet took advantage of this
opportunity to buy and store more than 100 thousand tons of petroleum which help to reduce cost
by 25% compared to the market. This resolution shows the considerable business acumen of
Vietjet because fuels account for more than 50 percent of the total costs. The third measure is
taken by Vietjet to solve the problems is transforming the configuration of several aircraft into
cargo transportation and applying a new operation method to enhance cargo transport capacity for
its fleet. Vietjet Air is the first airline in Vietnam to be approved to carry cargo on board. In 2020,
Vietjet shipped more than 60,000 tons of international cargo, and revenue from transporting goods
in the fourth quarter of 2020 increased rapidly that reached 75%. According to Vietjet's financial
report, the ancillary revenue structure reached 38.9% showing that this airline has strengthened
ancillary services to offset flight ticket revenue. Promoting cargo transportation and even co-
operate with US Postal Service to transport goods such as foods, medicine, clothes, and other
products marked an effort to adjust the logistic industry in the context of the Covid-19 pandemic
having a huge impact on international freight services because airlines reduce flights which
exporters also rely on to transport goods. Personally, this is also the most effective solution and has
a positive prospect in responding to a pandemic.

The Vietnamese government has been doing well in controlling the pandemic and
preventing the spread in the community. From my point of view, when the epidemic is controlled,
Vietjet Air can cooperate with restaurants, hotels, and tourist destinations to offer preferential
packages to stimulate tourism demand and attract tourists to increase revenue is not only the
structure of ancillary activities, but also helps to restore revenue in passenger transportation.

While airlines all over the world suffer losses and are forced to cut down their workforce,
Vietjet has made a great effort to take proactive measures to minimize losses. Vietjet is considered
to have the strength to be ready to grow again in the coming years with the ability to manage costs
and lead innovation in the aviation industry

REFERENCES
Anh, N. (2020, October 4). Vietjet đã vượt “bão” Covid-19 thế nào. Retrieved from
https://www.baogiaothong.vn/vietjet-da-vuot-bao-covid-19-the-nao-d481158.html
Linh, K. (2021, February 1). Vietjet Air lãi 70 tỉ đồng trong năm 2020. Retrieved from
https://vneconomy.vn/vietjet-air-lai-70-ty-dong-trong-nam-2020-20210131171207152.htm
Nam, T. (2020, November 17). Vietjet hợp tác cùng hãng vận tải hàng hóa lớn nhất thế giới UPS.
Retrieved from http://giaothong24h.vn/vietjet-hop-tac-cung-hang-van-tai-hang-hoa-lon-
nhat-the-gioi-ups.html
Vietjet Air. (n.d.). Chào mừng đến với hãng hàng không thế hệ mới Vietjet. Retrieved from
https://www.vietjetair.com/Sites/Web/vi-VN/NewsDetail/cong-ty/%20319/chao-mung-
den-voi-hang-hang-khong-the-he-moi-vietjet