High flight prices are slowing down Vietnam's tourism boom - this is how it continues!

High flight prices are slowing down Vietnam's tourism boom - this is how it continues!

Vietnam has established itself as an attractive travel destination in recent years, but the country's tourism sectors are facing a serious problem. According to an analysis report by Saigon – Hanoi Securities Joint Stock Company (SHS), high international airfares are one of the main reasons why Vietnam is losing competitiveness in the competition for international tourists. This high ticket price constellation affects two main groups of tourists in particular: visitors from the West, who stay on average for 14 days, and travelers from Japan, Korea and China, who spend around a week in Vietnam.

Current data shows that average ticket prices for economy class flights vary significantly from country to country. For Western visitors, prices are around $1,063 to Vietnam, while neighboring countries such as Thailand and Malaysia are $1,050 and $1,037 respectively. In comparison, Asian tourists pay an average of $358 for a flight to Vietnam, further increasing competitiveness regionally.

Rising flight prices and their effects

The high airfares have a direct impact on the costs for tourists. They make up around 75% of the travel budget for group tours and travelers from Europe and the USA are particularly affected by the increased prices. These are rising due to factors such as increased fuel costs, a weak exchange rate and a shortage of aircraft. There is also a lack of real competition in the air transport market, which contributes to the high prices.

The situation is made even worse by an increase in the number of passengers. In 2024, air passenger traffic is estimated at 80.3 million. Domestic travelers are forecast to decline by 10.5% in 2025 as many travelers prefer international destinations. Airfares are making it increasingly difficult for domestic travel companies to offer competitive offers, particularly to international customers.

A look at the ticket prices

An example aptly illustrates the situation: ticket prices for domestic flights, such as from Hanoi to Da Nang, were up to VND 4.5 million (approx. USD 190) compared to normal prices of around VND 2.5 million (approximately USD 105). These price increases are particularly noticeable during holidays and peak seasons, where flight revenues on popular routes such as Ho Chi Minh City to Hanoi can increase up to VND 7.2 million (approximately USD 300).

Additionally, data shows that during peak travel periods, up to 70% of Vietnamese tourists prefer international travel. High ticket prices on popular routes and on public holidays contribute to many travelers bypassing domestic destinations.

Suggestions to improve the situation

To address the challenges in the tourism sector, various proposals are put forward. The entry of new airlines into the market could create competition and thus reduce prices. It is also suggested that seasonal price caps be adjusted and large charter flights from Europe and the USA be subsidized. Increased cooperation with major airlines from the Middle East or Europe could also help to improve the situation.

In conclusion, despite its scenic and cultural advantages, Vietnam needs to become more competitive to counteract the rising costs of international air travel. Efforts to reduce costs while ensuring quality are crucial to the future of Vietnam's tourism sector.

For more information read the report from vietnam.vn and vietnamnet.vn.