Vietnam transport ministry urged to report on new cargo airline
The new cargo airline has a total investment of US$100 million.
The Vietnamese Ministry of Transport (MoT) is urged to report to the Government on Vietnam's first air freighter project before July 15.
The request was made by Deputy Prime Minister Le Van Thanh, related to a plea to help the establishment of IPP Air Cargo JSC’s in June.
| Vietnam has not yet had a cargo airline. Photo: Vietnam Airlines |
Previously, the Civil Aviation Authority of Vietnam (CAAV) requested the MoT for more guidance on building and appraising the application for an air transport business license for IPP Air Cargo.
The CAAV said last April that the Prime Minister agreed new airlines should be licensed only after 2022 when the aviation market supposedly recovers after the pandemic.
However, the IPP Air Cargo project owner said the new airlines in question are those carrying passengers, not air freighters.
The IPP Air Cargo, if come into being, would reduce logistic costs for exporting farm produce, in line with the Government’s direction.
The new cargo airline project has a total investment of VND2.4 trillion (about US$100 million), including 30% of the company’s equity capital, the remaining 70% mobilized.
The IPP Air Cargo is a member of Imex Pan Pacific Group (IPPG) owned by businessman Johnathan Hanh Nguyen.
The company planned to operate five cargo aircraft in the first year of operation, then gradually increase to seven aircraft in the second year and ten aircraft in the third year.
The company estimated to transport about 115,000 tons of cargo and generate revenue of US$71 million in the first year of operation. It expected to conduct the first commercial flight from the second quarter of 2022 and earn profits from the fourth year.
Vietnam has not yet had a cargo airline so far. More than 80% of Vietnam’s foreign shipments by air are delivered by foreign airlines.
The passenger planes of Vietnamese airlines have been used to carry freight that has made up for the loss of revenue from passenger air travel during the period of the Covid-19 pandemic.
