Vietnam Airlines has formally proposed removing the domestic airfare ceiling and granting it priority access to airport slots, Vietnam News has reported.
The suggestions were submitted as part of feedback on the draft revision of Vietnam’s Law on Civil Aviation.
Arguments in the article in favour:
- Market flexibility: Vietnam Airlines argues that removing fare caps would give airlines greater pricing autonomy, allowing them to respond to market dynamics, particularly post-COVID.
- Strategic role: As the national flag carrier, the airline says it should be granted priority access to airport slots to safeguard public transport continuity and national interests.
- Legal gaps: The current law, unchanged for nearly 20 years, lacks updated provisions to reflect evolving market conditions, including competitive slot allocation and oversight roles.
Arguments in the article against:
- Market concentration: The Ministry of Construction points out that Vietnam Airlines and Vietjet dominate the domestic market, making fare regulation necessary to prevent consumer harm.
- Consumer protection: Associate Professor Dr Ngo Tri Long, an economist, argues that price ceilings are essential where sellers dominate, to prevent excessive pricing and protect public access to essential services.
- Competition concerns: Granting slot priority could distort competition, giving incumbents unfair advantages in peak hours, which are critical to airline profitability.
See also: Vietnam’s Aviation Industry 2025: Growth, Key Players, Foreign Ownership, & More