Market Intelligence
Aviation Vietnam

Vietnam Aviation

Vietnam aviation industry was severely hurt by the coronavirus pandemic and for the first time, it experienced a negative growth rate with a dramatic drop of 39 % in passengers, 41.3% in cargo, and 43.5% in air traffic over 2019. This is equivalent to 63 million passengers, 1.3 million tons of cargoes, and 423,399 flights. 

While Vietnam had made some early success in controlling the pandemic in 2020 and early 2021, Vietnam aviation has continued suffering ups and downs due to the fourth wave of coronavirus outbreak with the lockdown order restricting domestic and international flights and applying strict social distancing. According to the Civil Aviation Authority of Vietnam (CAAV), in the first six months of 2021, Vietnam’s airports received 26.8 million passengers, 19.4 % lower than the same period in 2020, while cargo transportation increased to 668,000 tons of cargo, about 12. 7% higher than the same period in 2020.

Vietnam Air Traffic Management (VATM) is a unique provider for civil and military aircraft operating at airports nationwide and over Vietnam Flight Information Regions (FIRs), including 2 FIRs (Hanoi and Ho Chi Minh), 24 domestic air traffic service (ATS) routes and 36 international ATS routes, 11 international airports and 11 domestic airports. In 2020, VATM provided air navigation services for 423,399 flights, a dramatic drop of 43.5% over 2019, which resulted in a 56% reduction in revenue. This year, flight movement is estimated to drop 33% over 2020, with a revenue deficit of 24%.

There are significant opportunities for U.S. companies in the Vietnam Air Traffic Management sector. Air traffic volume in Vietnam is expected to recover by 2022, to the volume of 2019, and grow rapidly between 2023 to 2030. Vietnam’s narrow airspace and location in a high-traffic region create added challenges for managing flight transitions between ASEAN and the Northern Asia region. To enhance the service quality, VATM has invested to transform and digitalize its technical infrastructure, including the deployment of a new air traffic management (ATM) automation system and air traffic flow management (ATFM) system. U.S. companies may find opportunities in the following long-term and short-term projects:

  • New $136m air traffic control tower and other facilities for Long Thanh International Airport - Phase 1 (2021-2025): VCCS, VHF, Radar, communication equipment, ASMGCS system, D-ATIS system, MET System.
  • New Ho Chi Minh Air Traffic Control Center project (2021-2024): ATM System, VCCS System.
  • Radar Projects in Da Nang and Tan Son Nhat International Airport.
  • Digital- Automatics Terminal Information Service (D-ATIS) projects at Noi Bai, Da Nang, and Tan Son Nhat International Airport.
  • Communication, Navigation and Surveillance/ Air Traffic Management (CNS/ATM) development project (2020-2030) 

VATM completed the Master Plan on CNS/ATM by cooperating with Mitre under technical assistance granted by USTDA. VATM is working on project stage 2 to develop the concept of operation for the ATM system and detailed ATFM requirements. VATM is looking to cooperate with U.S. leading air navigation companies in the following areas:

  • Air Traffic Management (ATM) digitalization
  • Air Traffic Flow Management (ATFM)
  • System-Wide Information Management (SWIM)
  • Automated weather observation systems (AWOS) and aviation weather forecast

For more information contact Nga Hoang (Ho Chi Minh City) at Nga.Hoang@trade.gov and Anh Nguyen (Hanoi) at Anh.Nguyen@trade.gov.

.