On the sidelines of the Vietnam Travel and Tourism Summit 2018 in Hanoi, AirAsia Group's CEO Tony Fernandes and the counterpart of Hai Au Aviation Tran Trong Kien signed a memorandum of understanding, witnessed by Vietnamese Deputy Prime Minister Vu Duc Dam.
Accordingly, two companies will cooperate in construction, infrastructure and human resources to establish a low-cost airline which will be the sixth carrier in Vietnam, following Vietnam Airlines, Vietjet Air, Jetstar Pacific, VASCO and Bamboo Airways.
The value of investment under the memorandum is estimated to reach VND1 trillion ($44 million) of which AirAsia contributes 30 per cent and Hai Au is responsible for the rest.
Hai Au Aviation was established in 2011 between Thien Minh Group, one of Vietnam's leading travel and hospitality companies, and another unit in the travel industry. In 2013, Thien Minh became a major shareholder of Hai Au after the acquisition of its 89 per cent stake in this company.
The AirAsia – Thien Minh Group joint venture was announced in April 2017, planning to grow its fleet to 30 aircraft within three years.
The cooperation with Thien Minh Group represents AirAsia’s continuous ambition to penetrate in the domestic aviation network in Vietnam. In 2007, it attempted to form a joint venture with state-owned shipbuilder Vinashin but then the intention was cancelled.
In Southeast Asia, AirAsia is the biggest budget carrier and it has stablished branches in Indonesia, Thailand, India and Japan. The carrier operates 141 return flights weekly on 13 routes and has carried 12 million passengers to and from Vietnam since entering in 2005.