Brian Jeffrey
Current State of Domestic Airfares in Vietnam
As 2024 progresses, domestic flight prices in Vietnam remain at all-time high levels, showing no indications of reduction. While many travelers are choosing international trips, local travel agencies are facing difficulties, and airlines are enjoying significant profits.
Challenges for Travel Agencies
The CEO of a travel agency based in Hanoi, which primarily serves European and American clients, expressed frustration over the rising airfares between the New Year season and April 2025. The increased rates have made it almost impossible for them to secure tickets for their international travelers.
For instance, during the holiday season from late December 2024 to early January 2025, airfares for key routes like Hanoi to Da Nang or Hue have soared to about 4.5 million VND (around 190 USD), significantly higher than the usual peak price of approximately 2.5 million VND (about 105 USD).
This dramatic increase coincides with the busy New Year travel season and is a considerable obstacle for the local tourism sector.
The trend of rising domestic airfares began in late 2023 and was especially evident during the Lunar New Year holiday of 2024. Popular routes like Ho Chi Minh City to Hanoi, as well as to central provinces like Vinh, Thanh Hoa, and Quang Binh, saw round-trip fares hitting between 7 million and 7.2 million VND (around 300 USD), even at less desirable flight times.
Despite airlines leasing additional planes, ticket prices have remained high throughout the year.
Even during the typically slower months of March and April, fare rates showed little to no sign of decrease.
Major holidays, including the April 30-May 1 break and September 2, saw ticket prices from Hanoi to Phu Quoc soaring to between 7 and 8 million VND (approximately 295 to 340 USD). Other routes, such as those to Nha Trang, Con Dao, Da Nang, and Da Lat, ranged from 5 to 6 million VND (around 210 to 250 USD), making domestic travel unaffordable for many people.
According to the Vietnam Aviation Administration, domestic ticket prices have increased by 15-20% and are projected to remain elevated throughout 2024. Currently, ticket prices for the Lunar New Year of 2025 continue to exceed 7 million VND for busy routes.
For travel agencies, the rising costs of airfare contribute to 50-70% of overall tour expenses, severely affecting domestic tour packages. Regions like Da Nang, Quy Nhon, Tuy Hoa, and Phu Quoc have witnessed a sharp fall in domestic tourist numbers, as travelers opt for more affordable international destinations like Thailand, Malaysia, and South Korea.
Data shows that during busy holiday seasons, as many as 70% of Vietnamese tourists choose overseas trips over domestic travel, leaving local tourist spots struggling to draw visitors.
Factors Behind Rising Airfares
The Vietnam Aviation Administration has linked the soaring prices to a reduced fleet size, impacting both domestic and international flight operations in 2024 and 2025.
Since January, over 40 aircraft have been grounded for engine checks, with experts forecasting they may not be back in service until late 2026 or early 2027.
Additionally, Bamboo Airways has halted operations of its Embraer E190 fleet in a bid to cut costs, while Pacific Airlines has returned its leased planes to manage debts, exacerbating the airplane shortage.
In March 2024, new regulations from the Ministry of Transport implemented price cap increases of 3.7-6.7% for domestic flights, further escalating fares.
Increased fuel prices, fluctuating currency rates, and global aviation cost trends have also played a role in rising ticket prices. Vietnam Airlines reported a 76-77% increase in fuel and maintenance costs in 2024, making fare adjustments necessary.
Concerns remain regarding the transparency of airfare cost structures. The Ministry of Finance claims that taxes and fees only account for 10-30% of airfare costs, while travelers often feel the pinch of inflated ticket prices.
Efforts to Stabilize Fares
Airlines are taking steps to lease more airplanes to accommodate anticipated travel demand for the Lunar New Year 2025. Vietjet Air intends to add six new aircraft, while Vietnam Airlines is acquiring five additional planes.
The Ministry of Transport has also introduced measures aimed at reducing operational costs, such as cuts in takeoff and landing fees starting in 2025.
These initiatives are expected to gradually stabilize airfare prices, providing optimism for more affordable travel options in the near future.
