AirAsia to establish low-cost carrier in Vietnam

PETALING JAYA: AirAsia Bhd is forming a joint venture (JV) cooperation to establish a low-cost carrier (LCC) in Vietnam.

In a filing with Bursa Malaysia today, the airline said its wholly-owned subsidiary AirAsia Investment Ltd has executed a shareholders agreement and a share subscription agreement with Gumin Company Ltd, Tran Trong Kien and Hai Au Aviation Joint Stock Company for the joint venture.

“The rationale for the JV is to be an airline in Vietnam which offers an affordable but high quality airline service to Vietnamese and foreign tourists by leveraging the best-in-class LCC business model which is expected to give the Vietnamese population a greater choice as well as spur overall economic growth,” it said.

AirAsia added that Vietnam’s geographical location provides the foundation and support for the JV’s plans to operate domestic and international underserved routes focusing primarily in providing connectivity domestically into key cities in Vietnam as well as internationally to Asean, China, Korea and Japan from three major hubs namely Ho Chi Minh, Hanoi and Da Nang.