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Bamboo Airways to Los Angeles in 2020
April 12th 2019
Vietnamese start-up plans Taipei stopover from Hanoi. Read More »
Vietnamese carrier Bamboo Airways is emerging as Asia’s – and perhaps the world’s – most ambitious new airline. A commitment for 20 787s was signed before the airline even first flew in January 2019.
Plans for the widebodies are emerging as Bamboo Airways this week disclosed to Taiwanese media that it expects to serve Hanoi-Los Angeles via Taipei in 2020. But the plan raises questions.
There has been much discussion about the possibility of non-stop Vietnam-US flights since Vietnam re-gained FAA Category 1 status. But non-stop flights have unfavourable economics, as Orient Aviation covered in March 2019. Yet flying with a stopover puts Bamboo in a wide basket of one-stop options from other airlines. Pricing competition is intensive. Competitors can offer low fares since they are less reliant on premium Vietnam-US traffic, and have a large frequency and network on offer.
For competitors, Vietnam-US traffic is filler. But for Bamboo, it must seek financial stability on this low-yielding and typically leisure market.
Bamboo plans to serve Los Angeles, home to the largest Vietnamese community by far. But Bamboo will link LA with Hanoi, a small market. Vietnam’s trans-pacific demand is heavily concentrated out of Ho Chi Minh. The Taipei stopover potentially means a two-stop proposition between Los Angeles and Ho Chi Minh.
Unclear is the role of the government, and if perhaps trans-pacific Ho Chi Minh flights are being reserved for Vietnam Airlines. Bamboo Airways will launch Hanoi-Taipei service this October. There was no mention if the airline would later launch Ho Chi Minh-Taipei service, enabling passengers to change planes in Taipei for one-stop Ho Chi Minh-Los Angeles flights.
In Bamboo’s stopover city of Taipei, home airlines China Airlines and EVA Air already offer one-stop Los Angeles-Ho Chi Minh flights, as well as routings from other North American cities with Vietnamese communities. Start-up Starlux expects to join this North America-Southeast Asia crowd.
The exact traffic rights and fifth freedom opportunity out of Taipei are unclear. Vietnam Airlines had mooted a Japanese stopover, but Japan makes fifth freedom rights more available out of Osaka, where there is lower demand than Tokyo.
Bamboo Airways will need to build recognition in Southern California. The privately-owned airline may have more favourable recognition than state-owned Vietnam Airlines due to lingering overseas resentment towards the Vietnamese government. But promoting Hanoi as the link to Los Angeles may send the wrong political message to any sensitive groups.
Bamboo confirmed an order for 10 787-9s in February 2019. Its first international scheduled flight is due to be Nha Trang-Taipei in June with the A321neo. Later this month Bamboo will operate charters to Ibaraki, outside of Tokyo.
