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Taxi services in Vietnam back on track

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After facing a fierce competition from wide-spread ride-hailing services for a long time, traditional taxi firms in Vietnam have returned to a race to win over drivers and passengers.

They have invested heavily on apps and stabilized transport fees which are 20-30 percent lower than those of ride-hailing service providers, thus attracting drivers and customers.

Shifting from ride-hailing to taxi services

After working for ride-hailing firms, many drivers have admitted that the golden age of ride-hailing apps has passed.

Khoa, residing in Go Vap District, Ho Chi Minh City, who had been an Uber and Grab driver since these apps were launched in Vietnam, abandoned these apps to drive a traditional taxi.

According to Khoa, between 2015 and 2017, ride-hailing drivers earned daily incomes of VND1.5-2 million (US$63-85) thanks to the high number of customers, low charges, and numerous promotion programs.

However, ride-hailing firms have repeatedly increased their commission rates, which have reached 32 percent on average, making life harder for drivers.

“Taxi and ride-hailing fees are equivalent, while taxi firms have apps, switchboards and reasonable commission rates,” Khoa said.

Taxi firms, such as Vinasun and Mai Linh, have shifted to the franchise model to reduce the operation pressure.

Vinasun requires a franchise fee of VND11 million ($468.8) per year and a deposit of VND12 million ($511.4). Drivers cooperating with Vinasun will be entitled to a commission rate of 15.5 percent of their revenue.

Besides their drivers, taxi firms have worked with partner-drivers like ride-hailing firms. Their service fees are stable and do not fluctuate much during rush hours.

All drivers are required to comply with the firm’s regulations and are supervised and regulated through a switchboard.

Nguyen Minh Trang, a resident in Binh Thanh District, Ho Chi Minh City, said taxi and ride-hailing service fees have not been significantly different recently.

Moreover, users of ride-hailing services are charged with multiple kinds of fees during peak and rainy hours, while taxi fares remain unchanged.

“As a result, passengers will prefer traditional taxis during rush hours,” Trang added.

A resident booked a taxi through an app in Phu Nhuan District, Ho Chi Minh City on January 5, 2023. Photo: Quang Dinh / Tuoi Tre
A resident booked a taxi through an app in Phu Nhuan District, Ho Chi Minh City on January 5, 2023. Photo: Quang Dinh / Tuoi Tre

Surging taxi app downloads

Since ride-hailing services Uber and Grab were present in Vietnam in 2015, local taxi firms have developed taxi-hailing apps.

However, the app development has encountered multiple difficulties, according to a taxi firm’s representative.

As for traditional taxis, passengers have got used to calling switchboards and catching taxis on roads and have yet to be acquainted with using taxi-hailing apps.

“[Taxi operators] have improved features of apps by upgrading their servers and payment methods over the years,” the taxi firm’s representative noted.

According to statistics from a taxi firm, an average of 10,000 services were successfully booked through its app per day, accounting for 30 percent of services booked by all of its customers.

The number of passengers downloading the app reached 180,000 as of September last year, triple the figure in 2021.

“Taxi and ride-hailing firms share a same market. When technologies develop, taxi firms must invest heavily in technologies to increase their competitiveness,” the representative said, adding that apps help regulate pick-ups appropriately and minimize idle vehicles.

Nevertheless, traditional taxi firms admitted that many obstacles remain, such as the shortage of app developing manpower, inaccurate positioning of passengers, poor navigation, and drivers’ failure to comply with rules.

According to Le Trung Tinh, chairman of the Ho Chi Minh City Intercity Passenger Transport and Tourism Association, in the initial period, ride-hailing firms have spent efforts to take care of their customers with many promotion programs, such as low fares, discounts, and free extra services.

However, once they earned market shares, they charged many fees and increased fares.

“It is easy to understand why many people have chosen traditional taxis. However, some drivers [of taxi companies] inactivate apps or quit the job without notice and cancel services, impeding the regulation of drivers,” Tinh said.

Ta Long Hy, chairman of the Ho Chi Minh City Taxi Association, said ride-hailing service fees have increased to near those of taxi operators.

“Ride-hailing firms are almost unable to offer promotions, such as free or low-cost services,” Hy said, adding that this is a reason why thousands of service bookings are made per day through taxi firms’ apps.

Taxi-hailing apps need improving

Many customers agreed that they download taxi-hailing apps but do not use them as frequent as ride-hailing apps, such as Grab, Be, and Gojek.

Minh Nguyet, an employee of a logistics company in District 1, Ho Chi Minh City, assessed that apps of traditional taxi firms have improved with many payment methods but are not as good as ride-hailing apps.

“For example, I use Be’s app to book rides and food, deliver goods, buy air tickets, book inter-provincial coach tickets, and buy lottery tickets online. Most of ride-hailing apps can meet many demands, not only for ride hailing as those of taxi firms.”

A traffic expert also shared the view that customers have yet to be keen on taxi firms’ apps.

“Taxi operators face a shortage of capital and offer low bonuses for drivers, while ride-hailing firms still have effective programs to attract both drivers and customers.”

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam!

After facing a fierce competition from wide-spread ride-hailing services for a long time, traditional taxi firms in Vietnam have returned to a race to win over drivers and passengers.

They have invested heavily on apps and stabilized transport fees which are 20-30 percent lower than those of ride-hailing service providers, thus attracting drivers and customers.

Shifting from ride-hailing to taxi services

After working for ride-hailing firms, many drivers have admitted that the golden age of ride-hailing apps has passed.

Khoa, residing in Go Vap District, Ho Chi Minh City, who had been an Uber and Grab driver since these apps were launched in Vietnam, abandoned these apps to drive a traditional taxi.

According to Khoa, between 2015 and 2017, ride-hailing drivers earned daily incomes of VND1.5-2 million (US$63-85) thanks to the high number of customers, low charges, and numerous promotion programs.

However, ride-hailing firms have repeatedly increased their commission rates, which have reached 32 percent on average, making life harder for drivers.

“Taxi and ride-hailing fees are equivalent, while taxi firms have apps, switchboards and reasonable commission rates,” Khoa said.

Taxi firms, such as Vinasun and Mai Linh, have shifted to the franchise model to reduce the operation pressure.

Vinasun requires a franchise fee of VND11 million ($468.8) per year and a deposit of VND12 million ($511.4). Drivers cooperating with Vinasun will be entitled to a commission rate of 15.5 percent of their revenue.

Besides their drivers, taxi firms have worked with partner-drivers like ride-hailing firms. Their service fees are stable and do not fluctuate much during rush hours.

All drivers are required to comply with the firm’s regulations and are supervised and regulated through a switchboard.

Nguyen Minh Trang, a resident in Binh Thanh District, Ho Chi Minh City, said taxi and ride-hailing service fees have not been significantly different recently.

Moreover, users of ride-hailing services are charged with multiple kinds of fees during peak and rainy hours, while taxi fares remain unchanged.

“As a result, passengers will prefer traditional taxis during rush hours,” Trang added.

A resident booked a taxi through an app in Phu Nhuan District, Ho Chi Minh City on January 5, 2023. Photo: Quang Dinh / Tuoi Tre
A resident booked a taxi through an app in Phu Nhuan District, Ho Chi Minh City on January 5, 2023. Photo: Quang Dinh / Tuoi Tre

Surging taxi app downloads

Since ride-hailing services Uber and Grab were present in Vietnam in 2015, local taxi firms have developed taxi-hailing apps.

However, the app development has encountered multiple difficulties, according to a taxi firm’s representative.

As for traditional taxis, passengers have got used to calling switchboards and catching taxis on roads and have yet to be acquainted with using taxi-hailing apps.

“[Taxi operators] have improved features of apps by upgrading their servers and payment methods over the years,” the taxi firm’s representative noted.

According to statistics from a taxi firm, an average of 10,000 services were successfully booked through its app per day, accounting for 30 percent of services booked by all of its customers.

The number of passengers downloading the app reached 180,000 as of September last year, triple the figure in 2021.

“Taxi and ride-hailing firms share a same market. When technologies develop, taxi firms must invest heavily in technologies to increase their competitiveness,” the representative said, adding that apps help regulate pick-ups appropriately and minimize idle vehicles.

Nevertheless, traditional taxi firms admitted that many obstacles remain, such as the shortage of app developing manpower, inaccurate positioning of passengers, poor navigation, and drivers’ failure to comply with rules.

According to Le Trung Tinh, chairman of the Ho Chi Minh City Intercity Passenger Transport and Tourism Association, in the initial period, ride-hailing firms have spent efforts to take care of their customers with many promotion programs, such as low fares, discounts, and free extra services.

However, once they earned market shares, they charged many fees and increased fares.

“It is easy to understand why many people have chosen traditional taxis. However, some drivers [of taxi companies] inactivate apps or quit the job without notice and cancel services, impeding the regulation of drivers,” Tinh said.

Ta Long Hy, chairman of the Ho Chi Minh City Taxi Association, said ride-hailing service fees have increased to near those of taxi operators.

“Ride-hailing firms are almost unable to offer promotions, such as free or low-cost services,” Hy said, adding that this is a reason why thousands of service bookings are made per day through taxi firms’ apps.

Taxi-hailing apps need improving

Many customers agreed that they download taxi-hailing apps but do not use them as frequent as ride-hailing apps, such as Grab, Be, and Gojek.

Minh Nguyet, an employee of a logistics company in District 1, Ho Chi Minh City, assessed that apps of traditional taxi firms have improved with many payment methods but are not as good as ride-hailing apps.

“For example, I use Be’s app to book rides and food, deliver goods, buy air tickets, book inter-provincial coach tickets, and buy lottery tickets online. Most of ride-hailing apps can meet many demands, not only for ride hailing as those of taxi firms.”

A traffic expert also shared the view that customers have yet to be keen on taxi firms’ apps.

“Taxi operators face a shortage of capital and offer low bonuses for drivers, while ride-hailing firms still have effective programs to attract both drivers and customers.”

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230109/taxi-services-in-vietnam-back-on-track/70838.html

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Vietnam Real Estate Credit Soars to $109 Billion in 2022

Vietnam’s real estate sector saw a surge in credit in 2022, with outstanding loans reaching 2.58 million billion VND, equivalent to $109 billion, up 24.27% from the end of 2021.

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The State Bank of Vietnam hosted a Real Estate Credit Conference on February 8th, in Hanoi, where the news was announced.

This sector saw the fastest growth, accounting for 21.2% of total outstanding loans to the economy, the highest in the past five years.

Outstanding loans for real estate business increased by 11.5%, while consumer/self-use credit balance increased by 31.1%. Housing needs accounted for 62.19% of outstanding loans, while land use rights accounted for 20.66%.

The State Bank is committed to ensuring safe and effective growth in the real estate sector, controlling credit risk and promoting stability. 

It will continue to operate monetary policy firmly and flexibly, creating favorable conditions for the real estate sector to grow and develop. 

The legal framework on credit and banking activities will also be improved to increase access to credit for people and businesses, including the real estate sector.

Credit institutions will be directed to focus on feasible projects with good sales ability and to minimize operating costs and administrative procedures. 

The State Bank will control credit risk for the high-end real estate segment, which has excess supply, and control credit concentration to ensure operational safety of the bank.

Overall, the State Bank of Vietnam is dedicated to supporting the growth and stability of the real estate sector, contributing to macroeconomic stability and supporting economic growth.

Source: ZingNews

Source: https://e.nhipcaudautu.vn/real-estate/vietnam-real-estate-credit-soars-to-109-billion-in-2022-3350491/

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Vietnam Airlines to reopen more air routes to China

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Vietnam Airlines plans to resume five more routes connecting Vietnam and neighboring China in the next two months, taking the total number of its operating air routes between the two countries to nine out of the ten routes in the pre-pandemic period.

In particular, the national flag carrier will restore air services between Hanoi and Beijing in March with three flights per week.

It will also increase the frequency of flights from Hanoi and Ho Chi Minh City to Guangzhou and Shanghai to four from one or two flights per week.

In addition, four air routes between Da Nang and Guangzhou, Shanghai, and Chengdu, and between Hanoi and Chengdu are scheduled for resumption in April with two weekly flights on each route.

The airline plans to use wide-body A350 and B787 aircraft on some air routes to the northern neighbor starting in September this year.

Besides Vietnam Airlines, Vietjet Air is operating air services between Ho Chi Minh City and Shenzhen, Hangzhou, Shanghai, Sichuan, and Wuhan with six flights per week.

The budget air carrier reopened air services from Canh Ranh City under Khanh Hoa Province in south-central Vietnam to Changsha and Chengdu.

Vietjet will operate a total of 85 air routes this summer.

The reopening and increase of air routes to China are aimed at meeting travel and tourism demand between the two countries, which is forecast to recover.

A Vietnam Airlines representative said the number of passengers on air routes between Vietnam and China remains small but it is increasing.

In an optimistic scenario, China will continue easing procedures and the number of passengers on these air routes this year is expected to reach 80 percent of the figure in 2019.

After reopening its doors to international travelers in March last year, Vietnam’s domestic tourism has recovered strongly. However, its international tourism segment, which earlier accounted for 60 percent of the country’s tourism revenue, has yet to recover as expected.

Nevertheless, Vietnam has good reasons to hope for stronger recovery, especially after China reopened its doors on January 8.

Vietnam will see a recovery of the number of Chinese visitors by 50-80 percent in 2023 compared to the pre-pandemic volume, or three to 4.5 million Chinese tourists, HSBC experts forecast.

In 2019, Vietnam Airlines served 8.1 million passengers on Vietnam-China air routes, or 19 percent of the airline’s total passengers.

China was among the air carrier’s top three markets with the highest number of passengers.

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Vietnam Airlines plans to resume five more routes connecting Vietnam and neighboring China in the next two months, taking the total number of its operating air routes between the two countries to nine out of the ten routes in the pre-pandemic period.

In particular, the national flag carrier will restore air services between Hanoi and Beijing in March with three flights per week.

It will also increase the frequency of flights from Hanoi and Ho Chi Minh City to Guangzhou and Shanghai to four from one or two flights per week.

In addition, four air routes between Da Nang and Guangzhou, Shanghai, and Chengdu, and between Hanoi and Chengdu are scheduled for resumption in April with two weekly flights on each route.

The airline plans to use wide-body A350 and B787 aircraft on some air routes to the northern neighbor starting in September this year.

Besides Vietnam Airlines, Vietjet Air is operating air services between Ho Chi Minh City and Shenzhen, Hangzhou, Shanghai, Sichuan, and Wuhan with six flights per week.

The budget air carrier reopened air services from Canh Ranh City under Khanh Hoa Province in south-central Vietnam to Changsha and Chengdu.

Vietjet will operate a total of 85 air routes this summer.

The reopening and increase of air routes to China are aimed at meeting travel and tourism demand between the two countries, which is forecast to recover.

A Vietnam Airlines representative said the number of passengers on air routes between Vietnam and China remains small but it is increasing.

In an optimistic scenario, China will continue easing procedures and the number of passengers on these air routes this year is expected to reach 80 percent of the figure in 2019.

After reopening its doors to international travelers in March last year, Vietnam’s domestic tourism has recovered strongly. However, its international tourism segment, which earlier accounted for 60 percent of the country’s tourism revenue, has yet to recover as expected.

Nevertheless, Vietnam has good reasons to hope for stronger recovery, especially after China reopened its doors on January 8.

Vietnam will see a recovery of the number of Chinese visitors by 50-80 percent in 2023 compared to the pre-pandemic volume, or three to 4.5 million Chinese tourists, HSBC experts forecast.

In 2019, Vietnam Airlines served 8.1 million passengers on Vietnam-China air routes, or 19 percent of the airline’s total passengers.

China was among the air carrier’s top three markets with the highest number of passengers.

Like us on Facebook or  follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230208/vietnam-airlines-to-reopen-more-air-routes-to-china/71400.html

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Vietnam Airlines performs worst among local airlines in on-time ratings: report

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National flag carrier Vietnam Airlines scored the lowest rate of on-time flights among local airlines in 2022, the country’s aviation watchdog said in a report released on Monday.

The annual report on flight cancelations and delays by the Civil Aviation Authority of Vietnam (CAAV) covers the on-time statuses of six Vietnamese carriers, including Vietnam Airlines, budget carrier Pacific Airlines, no-frills airline Vietjet, hybrid carrier Bamboo Airways, Vietnam Air Services Co. (VASCO), and travel airline Vietravel Airlines.

The six carriers operated 312,841 flights last year, 32,260 — or 10.3 percent — of which were delayed, according to the report.

Vietnam Airlines operated 115,987 flights, 12.5 percent of which were delayed, which translated to the lowest on-time rate among the six airlines.

Vietjet delivered the second-worst on-time performance, with 13,310 out of 115,349 flights, or a 11.5-percent rate, departing behind schedule in the period.

Bamboo Airways continued to be the most punctual among the carriers for the fourth consecutive year, with only 4.9 percent of 51,959 flights delayed.

Pacific Airlines came second with a late rate of 6.1 percent, out of 16,567 flights operated.

Vietravel Airlines was slightly behind with 93 percent of 4,895 flights operated in the year arriving on time.

VASCO, a subsidiary of the national flag carrier, had 92.1 percent out of 8,084 services on time.

The carrier focuses on flights between Ho Chi Minh City and Con Dao off the southern province of Ba Ria-Vung Tau, Phu Quoc Island off the southern province of Kien Giang, and the Mekong Delta city of Can Tho.

According to the CAAV, most of the delayed flights were caused by ‘late arrival of aircraft,’ which means a late flight would affect the schedule of the next flight using the same aircraft.

In 2022, 1,155 flights were canceled. Vietnam Airlines called off 715 flights, Vietjet 266 flights, VASCO 92 flights, Bamboo Airways 64 flights, and Vietravel Airlines and Pacific Airlines nine flights each.

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National flag carrier Vietnam Airlines scored the lowest rate of on-time flights among local airlines in 2022, the country’s aviation watchdog said in a report released on Monday.

The annual report on flight cancelations and delays by the Civil Aviation Authority of Vietnam (CAAV) covers the on-time statuses of six Vietnamese carriers, including Vietnam Airlines, budget carrier Pacific Airlines, no-frills airline Vietjet, hybrid carrier Bamboo Airways, Vietnam Air Services Co. (VASCO), and travel airline Vietravel Airlines.

The six carriers operated 312,841 flights last year, 32,260 — or 10.3 percent — of which were delayed, according to the report.

Vietnam Airlines operated 115,987 flights, 12.5 percent of which were delayed, which translated to the lowest on-time rate among the six airlines.

Vietjet delivered the second-worst on-time performance, with 13,310 out of 115,349 flights, or a 11.5-percent rate, departing behind schedule in the period.

Bamboo Airways continued to be the most punctual among the carriers for the fourth consecutive year, with only 4.9 percent of 51,959 flights delayed.

Pacific Airlines came second with a late rate of 6.1 percent, out of 16,567 flights operated.

Vietravel Airlines was slightly behind with 93 percent of 4,895 flights operated in the year arriving on time.

VASCO, a subsidiary of the national flag carrier, had 92.1 percent out of 8,084 services on time.

The carrier focuses on flights between Ho Chi Minh City and Con Dao off the southern province of Ba Ria-Vung Tau, Phu Quoc Island off the southern province of Kien Giang, and the Mekong Delta city of Can Tho.

According to the CAAV, most of the delayed flights were caused by ‘late arrival of aircraft,’ which means a late flight would affect the schedule of the next flight using the same aircraft.

In 2022, 1,155 flights were canceled. Vietnam Airlines called off 715 flights, Vietjet 266 flights, VASCO 92 flights, Bamboo Airways 64 flights, and Vietravel Airlines and Pacific Airlines nine flights each.

Like us on Facebook or follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230207/vietnam-airlines-performs-worst-among-local-airlines-in-ontime-ratings-report/71379.html

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