Vietnam’s Aviation Boom Soars

Strong Recovery and Strategic Expansion in Vietnam’s Aviation Sector

This summer has marked a significant turning point for Vietnam’s aviation sector, with the industry experiencing robust growth and an increasingly promising outlook. The recovery of international routes, combined with new strategic partnerships, is shifting the focus from a competitive domestic market to more profitable international opportunities.

Stable Growth and Increased Passenger Numbers

According to the Civil Aviation Authority of Vietnam (CAAV), the first half of 2025 saw a total of 41.3 million passengers traveling through the country’s airports, reflecting a 10% increase compared to the same period in 2024. Notably, the international market accounted for 23 million passengers, a 13% rise, while the domestic market maintained steady growth at 7%, with 18.4 million passengers.

Nguyen Van Nhung, chief accountant of Airports Corporation of Vietnam (ACV), highlighted that the international segment has nearly fully recovered. Key markets such as China, Japan, South Korea, Southeast Asia, India, and Australia have all shown consistent growth. This strong recovery provides a solid foundation for ACV to continue investing in infrastructure upgrades and improve service quality across its 22 airports nationwide.

Infrastructure Upgrades and Service Improvements

ACV manages nine international airports and 13 domestic airports, providing security, ground services, passenger assistance, and flight operations support for most domestic and international carriers. The surge in international travelers not only boosts ground service revenues but also generates essential investment resources to address infrastructure bottlenecks. This includes congestion at major airports like Noi Bai and Tan Son Nhat, as well as facility upgrades at popular tourist gateways such as Cam Ranh and Phu Quoc.

Despite regulated domestic fares, intense competition compels airlines to offer frequent discounts and promotional fares to attract customers. As a result, profit margins on domestic tickets are approaching their limits. Expanding international services and broadening flight networks is therefore an inevitable strategy to open new profit channels, cater to high-spending passenger segments, and support Vietnam’s tourism industry in attracting direct foreign currency inflows.

Vietnam Airlines Leads International Expansion

Vietnam Airlines is leading this trend, having launched a direct Hanoi–Milan route earlier in July, bringing its total number of direct European routes to 10. Simultaneously, the carrier announced a codeshare partnership with Saudia Airlines, the national carrier of Saudi Arabia. This agreement enables Vietnamese passengers to travel to Jeddah and Riyadh with a single ticket and check-in process, while accumulating SkyTeam alliance miles.

A Vietnam Airlines representative stated that the codeshare deal opens a new connection between Vietnam and the Middle East — a market rich in tourism, pilgrimage, and commerce potential with strong spending power. This is a strategic move as Saudi Arabia attracts international tourists with its luxury services and unique culture, while also serving as a vital East-West transit hub.

Low-Cost Carriers Expand Their Reach

In addition to traditional airlines, low-cost carrier Vietjet is aggressively expanding its international footprint, focusing on the Chinese market — the largest source of tourists before the COVID-19 pandemic, expected to rebound strongly with relaxed visa policies. At the beginning of July, Vietjet inaugurated a direct Hanoi–Chengdu route, extending its dense network from Hanoi and Ho Chi Minh City to Beijing, Shanghai, Guangzhou, and Xi’an. Flights operate four times weekly with convenient night departures catering to both business travelers and tourists.

Nguyen Hung, a frequent traveler, commented that previously business trips required transiting through Guangzhou, which was time-consuming and costly. Now, the direct flight with convenient night timings and competitive fares makes travel much easier for both business and leisure.

Foreign Carriers Capitalize on Tourism Potential

Foreign carriers have also swiftly capitalized on Vietnam’s tourism potential. Scoot, the low-cost arm of Singapore Airlines, announced it will launch a direct Singapore–Cam Ranh route starting November 21, operating twice weekly, with plans to increase frequency to five times weekly from January 2026. This is the first direct flight connecting Singapore with Cam Ranh.

A representative of Cam Ranh International Terminal noted that Scoot’s choice of Cam Ranh, alongside Da Nang and Kota Bharu (Malaysia), to establish its Southeast Asia network highlights the appeal of Vietnam’s coastal tourism. The route will not only serve local residents of Khanh Hoa province but also attract Singaporean tourists and international travelers connecting via Changi Airport — one of the world’s leading transit hubs.

Scoot’s launch of flights to Cam Ranh is expected to give a significant boost to the local tourism sector, benefiting hotels, resorts, transport services, tour guides, and catering businesses, while helping Khanh Hoa affirm its position as Vietnam’s premier coastal tourism center.