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Vietnam Business » Vietnam Business News » Demand for air cargo likely to grow 30 percent

Demand for air cargo likely to grow 30 percent

"Demand will likely grow by 30 percent in the second half of this year in comparison with the same period last year due to high demand from Asia, the EU and the US . Hong Kong Airlines return flights connecting HCM City with Hong Kong had an occupancy rate of 80-90 percent," said Do Xuan Quang, general director of HCM City-based Victor Cargo Transportation Co.

Demand for air cargo is expected to jump in the last months of this year, creating potential for local and international freight airlines, said industrial analysts. Victor Co works as a general agent for foreign airlines in Vietnam , including Malaysia Airlines, South African Airways, and Egypt Air. Vo Huy Cuong, director of the Civil Aviation Administration of Vietnams aviation transportation department said Hong Kong Airlines was a new-comer, starting operations in January with five cargo flights per week on the HCM City-Hong Kong route. Others such as Cathay Pacific, Eva Air, Korean Air, China Airlines, FedEx, DHL and CargoLux are also bolstering their freight flights to Vietnam . Local airlines have also paid great attention to this promising market. HCM City-based Trai Thien Air Cargo is preparing to debut its first commercial cargo flight in September. Trai Thien was established in June 2008 with a registered capital of 500 billion VND (26.3 million USD). If Trai Thien begins services from September 5 as scheduled, it will become the first private air cargo carrier in Vietnam . It will transport cargo throughout south-east and north-east Asia . The airline officially received a licence to provide freight services from the Civil Aviation Administration of Vietnam (CAAV). However, Cuong said Trai Thien had not yet begun operations as the carrier had not rented aircraft that met CAAV standards. Under Vietnamese aviation regulations, the leases of planes entering Vietnam must not exceed 25 years. Le Giang Long, deputy director of Trai Thien said the carrier had discussed leases with companies from Singapore and the EU, but their planes did not meet the prescribed 25-year time period. The carrier recently entered negotiations with Singaporean-owned Airmark Co, and believed the company could meet the requirement. Trai Thien expected that the 18 tonne capacity B737-300F would arrive in Vietnam later this month to begin operating the scheduled daily Hong Kong-HCM City route. Future destinations include Singapore , Phnom Penh , Bangkok , Guangzhou and Taipei . It is expected that the carrier will receive the second B737-300F in the first quarter next year. This will service domestic routes from HCM City to Hanoi , Da Nang , Nha Trang and Da Lat. "If capacity remains at 60-70 percent use, we expect to reach break-even point after two years of operation for the international flights," Long said. "The company has made good preparations. Initially, we signed a memorandum of co-operation with US partners such as FedEx, UPS, and DHL and a cargo service company in Hong Kong and Singapore, to ensure enough cargo to meet the 70-80 percent capacity rate, for return flights to HCM City," he said. Quang said that it would not be easy initially for Trai Thien. However, it was essential to launch a private freight air service in Vietnam and he also wanted to open a similar cargo airline in the future. The amount of goods transported by air in the first six months of this year rose by 36 percent over the same period last year, according to CAAV.

Vietnam Business And Financial News Network. Source [english.vietnamnet.vn]

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