The dossier for the establishment of the Canh Dieu (Kite) Air project will not be submitted to the prime minister for approval, as it has not met certain conditions, Deputy Prime Minister Trinh Dinh Dung said on the request of the Ministry of Planning and Investment (MPI) for the licensing of the project.

Photo: TMG

Earlier, Deputy Prime Minister Dung agreed to a proposal of the Ministry of Transport (MoT) to delay the licensing of new airlines until the recovery of the aviation industry, expected to be in 2022. Covid-19 plunged the global aviation industry and that of Vietnam due to travel restrictions with all international paralyzed and most domestic flights suspended in March and April to prevent the spread of the coronavirus.

The government’s priority would be to address difficulties and concerns of operating Vietnamese airlines, stated Mr. Dung in a document issued on July 17. The MPI is the appraisal agency for Kite Air project. Based on the recommendations of the Ministry of Transport, it would to submit the project to the Prime Minister for licensing.

Kite Air's plan was developed in 2018-2019 amid the rise of the national aviation market with a growth rate of 13-20% each year. The owner of the low-cost airline project is Thien Minh Aviation JSC. The air carrier would operate six ATR72 aircraft on domestic routes. The fleet would be expanded to 30 aircraft by 2025.

Currently, Vietnam has six operational airlines including national flag carrier Vietnam Airlines, budget carrier Pacific Airlines (with a majority owned by Vietnam Airlines), Vietjet Aviation, Vietnam Air Services (VASCO), Bamboo Airways, and Vietstar Airlines, a joint carrier between private and military stake holders. 

In addition, Vietravel Airlines, Vinpearl Air and Kite Air are awaiting for operation authorization, with charter capitals of VND700 billion (US$29.9 million), VND1 trillion (US$ 43.9 million) and VND56.3 billion VND (US$56.4 million), respectively.