Thailand
Vietnam Airlines mulls selling stake in Cambodia’s flag carrier
Vietnam Airlines is considering unloading its ownership stake in Cambodia Angkor Air in light of the stiff competition the Cambodian carrier is facing.
Airline Business published this month an interview with Duong Tri Thanh where the Vietnam Airlines chief executive talked about the possibility of selling the company’s stake in Cambodia Angkor Air.
Vietnam Airlines owns 49 percent of Cambodia Angkor Air, while the remaining 51 percent belongs to the Cambodian government.
“With so many new start-up airlines, it makes the position in that market very difficult,” Mr Duong said in the interview, apparently referring to the Cambodian market that is being saturated with new entrants, particularly Chinese-backed carriers.
“We are considering how to arrange to the point where we may maintain Vietnam Airlines cooperation, but on the ownership side, we may have to consider whether to reduce or withdraw,” he said.
There are ten registered airlines in Cambodia. That number was significantly higher just a few months ago but stiff competition and market losses forced many airlines to reduce or altogether stop their operations.
KC International Airlines, Cambodia Bayon Airlines, and Small Planet Airlines filed for bankruptcy or ceased operating this year. Bassaka Air, meanwhile, has stopped its flight operations except for charter services.
An international business expert with extensive knowledge of Vietnam Airlines said the Vietnamese carrier’s willingness to sell its shares in Cambodia Angkor Air is not a surprise.
“Vietnam Airlines partnered with the Cambodia government to set up Cambodia Angkor Air ten years ago in a way to help the Kingdom’s civil aviation industry,” Frederic Chan, corporate investment and development officer at WS Asia Pacific Co Ltd, said in a phone interview.
“Through the years Vietnam contributed a lot to the development of the civil aviation industry here, including in opening three routes between the two countries and the opening of a fourth one between Danang and Phnom Penh by the end of October.
“If this report is true, it just means that Cambodia Angkor Air, as a national carrier, will operate fully independent,” he added.
Cambodia Angkor Air is the flag carrier of Cambodia. The airline flies domestic and international routes, including Ho Chi Minh City and Danang in Vietnam, and Guangzhou, Macau, Hangzhou, and Beijing in China.
It operates a fleet of two Airbus A320, one A321, and three ATR-72-600. This year, Cambodia Angkor Air marked its 10th year of operations in the Kingdom.
Tekrech Samrach, chairman of Cambodia Angkor Air, did not reply to a request for comment as of presstime.
Source: https://www.khmertimeskh.com/50653740/vietnam-airlines-mulls-selling-stake-in-cambodias-flag-carrier/