AirBridgeCargo has added Vietnam to its global network. The Russian all-cargo carrier entered the Vietnam market on April 1 with the launch of twice-weekly freighter flights to Hanoi.

The flights, which operate on Wednesdays and Saturdays, are routed from the Vietnamese capital to Hong Kong and on to ABC’s hub at Moscow’s Sheremetyevo airport, where the cargo connects with the carrier’s links to Europe and the US.

“AirBridgeCargo believes that entering the Vietnamese market is a logical next step in developing the strategically important Asian market,” commented Robert van de Weg, the carrier’s senior vice president of sales and marketing. “Vietnam’s market development is another bright example of the region’s strength and continued potential and we are excited to start serving our customers there. We are confident that the new Hanoi service will complement our existing network and that this will benefit our clients.”

Vietnam’s economy has been on a roll. Its growth accelerated in the fourth quarter of last year to just a whisker shy of 6% (5.98), beating the 5.8% rate that had been projected. Exports climbed 13.6%, as manufacturers from more developed Asian economies ramped up their investment in Vietnam.

One reason for the growth has been the often-cited shift of low-end manufacturing from China, which was confirmed in the numbers of HSBC’s purchasing managers index (a composite indicator of factory output) last November, which showed a marked decline in China and a pronounced rise in its smaller neighbour.

However, Vietnamese factories increasingly produce more advanced products that lend themselves to shipping by air, notably smart phones. Last autumn Samsung announced plans to invest up to US$3 billion to expand its mobile phone production in Hanoi. After its US$7.2 billion acquisition of Nokia last year, Microsoft has been shifting production increasingly to Vietnam. According to one report, it is going to run as many as 39 mobile phone production lines in Vietnam this year. Meanwhile, Samsung is building up LCD monitor production in Ho Chi Minh City.

According to one estimate, 48% of the exports from Hanoi go to Europe or the US, and 33% are headed for other markets in Asia. From Ho Chi Minh City, 50.5% of the exports end up in Europe or the US.

ABC is the latest international carrier to tap into these flows. Over the past two years, maindeck lift has steadily climbed, especially in Hanoi, which is now up to 40 weekly freighter flights. Last December, Cargolux added a fifth weekly flight to Vietnam, of which two go to Ho Chi Minh City.

Low-cost passenger airlines often have little interest in cargo, given their heavy focus on narrowbody aircraft as well as concerns that turn-around times could be affected by the loading and unloading of freight. However, Vietjet launched a cargo affiliate last year, and now it is looking to maindeck operations. Its management has expressed an interest in flying freighters. It is considering two types, A330-200Fs and B737-400Fs. The latter would fly on feeder routes, while the mid-sized A330s would serve destinations in the Asia-Pacific region. 

Vietnam Airlines has not made any moves towards freighters, but it is aiming to get a larger slice of the longhaul cargo market. Having recently shifted its London flights from Gatwick to Heathrow, the national carrier is in the process of building up London as a third European gateway besides Frankfurt and Paris. It doubled it UK flights to two per week each from Ho Chi Minh City and Hanoi when it made the switch to Heathrow, and more flights will be added with the arrival of B787 aircraft, to bring it to six weekly frequencies before the end of the year. Halfway through 2016, its management wants to have daily flights between Ho Chi Minh City and Heathrow.

By Ian Putzger

Air Freight Correspondent | Toronto