Friday 29 Mar 2024
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KUALA LUMPUR (Dec 6): AirAsia Group Bhd has reaffirmed its intention to set up a joint-venture (JV) low-cost carrier in Vietnam by signing a memorandum of cooperation with a Vietnamese partner today.

The memorandum was signed by AirAsia Group CEO Tan Sri Tony Fernandes, and Vietnamese businessman Tran Trong Kien — in his capacity as CEO of Thien Minh Travel Joint Stock Company and general director of Hai Au Aviation Joint Stock Company.

The signing, conducted on the sidelines of the Vietnam Travel and Tourism Summit 2018 in Hanoi, was witnessed by Vietnamese Deputy Prime Minister Vu Duc Dam, AirAsia said in a statement.

“AirAsia is an Asean airline,” Fernandes said. “And in Asean, Vietnam is one of the last remaining countries with a large population we’re not in.”

“Last year, when we announced this JV, we were bullish about Vietnam and we remain incredibly bullish about serving one of the most dynamic, fastest-growing economies in Asia,” he said, adding AirAsia is already the largest foreign airline group in Vietnam by capacity.

The statement did not mention the size of the stake AirAsia will have in the JV, but Vietnam’s laws only allow up to 30% foreign ownership in airlines.

Tran said the joint venture was a “much needed and welcome move”, as it will “bring more and better choices to our people in the years to come”.

AirAsia operates 141 return flights weekly on 13 routes, connecting Hanoi, Ho Chi Minh City, Da Nang, Nha Trang and Phu Quoc with Kuala Lumpur, Penang and Johor Bharu in Malaysia; Bangkok and Chiang Mai in Thailand; and Manila in the Philippines. 

The airline has carried 12 million passengers to and from Vietnam since entering the market in 2005.

AirAsia Group shares were trading six sen or 1.93% lower at RM3.05 as at 4pm today, for a market capitalisation of RM10.39 billion.

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