America is a much sought-after route for many airlines. (Photo: Oliver Holzbauer via Flickr)
Last month it was announced that Vietnam Airlines had secured its first ever license to fly direct to the United States. Not only is it the first such license given to Vietnam Airlines, it is also the first license to fly direct to the United States given to any Vietnamese airline, ever.
What really makes Vietnam Airlines’ application to fly direct to the United States notable is the fact that it is a significant risk. Vietnam Airlines is a sizeable carrier, but the vast majority of its routes are within Asia, with a handful stretching to Europe.
On top of this, it faces stiff competition from its fellow Asian airlines, many of which are much better positioned to weather ups and downs in demand. Flight Global’s Asia managing editor, Greg Waldron, discussed Vietnam Airlines’ position in The Jakarta Post, saying,
“There are some serious competitive and practical restraints facing (Vietnam Airlines)”.
There is a high barrier to entry for setting up direct flights to the United States, let alone making them a financial success. For Vietnam Airlines to take a gamble on long-haul flights to the United States, there must be some significant motivating factor involved.
Big aspirations for small airlines
Vietnam Airlines is by no means the only medium-sized airline to set its sights on long-haul flights to the United States. Just yesterday, One Mile At A Time reported on TAROM’s plans to recommence flights to New York, some 16 years after it canceled the route.
Even small airlines make plans to fly to the United States. (Photo: Mark Harkin via Flickr).
TAROM is significantly smaller than Vietnam Airlines, with a fleet of just 25 active aircraft. Yet it is also taking a big risk setting up an expensive, long-haul route which will see lots of competition from larger airlines.
Even more surprising than Vietnam Airlines and TAROM, MIAT Mongolian Airlines applied to launch a service from Ulaanbaatar to the United States. MIAT has an active fleet of just seven aircraft, making the gamble of long-haul flights to the United States hard to justify.
What makes routes to the United States so attractive?
America is known as the land of opportunity for a reason. People from across the world move there to settle and start a new life.
This means there is a large foreign-born population within the country and a subsequent high demand for flights to many different countries around the world, as people visit their families or travel back home.
Prestige is a big factor driving airlines to fly to the United States. (Photo: Oliver Holzbauer via Flickr).
But even this increased demand doesn’t fully explain why so many small airlines place such importance on flights to the United States.
A factor that arguably plays just as big a role is prestige. The United States is the richest country in the world, and any regional airline is likely to gain a big boost in reputation in its home market by offering sought-after flights to America.
Cre: Henry Bewicke – Simple Flying
Nguyen Xuan Nghia – COMM
