Vietnam Airlines aims to be Southeast Asia's No. 2 carrier

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A file photo shows a Vietnam Airlines' Airbus A330-200 landing at the central city Da Nang's airport. The airline aims to become Southeast Asia's second-biggest carrier by 2020.

Vietnam Airlines aims to become Southeast Asia's second-biggest full-service carrier by the end of the decade as it more than doubles its fleet in a bid to surpass Thai Airways International Pcl and Malaysian Airline System Bhd.

"If we are successful in expanding the network and strengthening our position, we'll be number two after Singapore Airlines," Chief Executive Officer Pham Ngoc Minh said at a briefing in Hanoi. The state-owned carrier may rank third by 2015, he said.

The carrier intends to add Airbus SAS A320neo and A350 aircraft, as well as Boeing Co. 787s, as it grows to 170 planes in order to support expansion plans and tap rising domestic travel. The airline's passenger traffic grew about 11 percent last year, Minh said, compared with a 5 percent gain for Malaysian Air and a 0.7 percent drop for Thai Air.

"We have ambitions to be a regional network carrier," Minh said. The airline, which operates 73 planes, increased revenue 25 percent last year, he said.

The carrier flew 12.3 million passengers in 2010. It hasn't released 2011 numbers yet. Thai Air flew 18.4 million travelers last year, while Malaysian Air carried 13.3 million and Singapore Air's main unit transported 16.9 million. The Singapore-based carrier is biggest in terms of passenger traffic, which measures how far paying customers flew.

IPO delay

Vietnam Air will postpone plans for an initial public offering until the second half of next year from this year because the "market is not yet attractive to investors," Minh said, without elaborating.

The carrier began flights to London Gatwick, the city's second airport, last year. Services are less than 60 percent full, compared with an average of 80 to 82 percent for other European flights, Minh said.

"Competition is fierce in the London market," he said. The airline has no plans to pare capacity, and it may add more flights next year if the market improves, he said.

Flights to Berlin, Amsterdam and Milan may also be added in the next couple of years, Minh said. The carrier, which already flies to Frankfurt and Paris, is a member of the SkyTeam alliance alongside Air France-KLM Group and Delta Air Lines Inc.

Vietnam Air will receive 26 A321 planes by 2014 and it intends to order A320neo-family planes for deliveries after that, Nguyen Thi Thanh Van, a board member in charge of aircraft and fleet development, said at the briefing. The A320neo is a revamped version of the Airbus A320 that features new engines.

The carrier will also get 19 Boeing 787-9 Dreamliners and 14 Airbus A350s beginning in 2015, Van said. It will lease 11 of the 787s and four of the A350s, she said.

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