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Sunday, June 16, 2024

Ca Mau to compensate for airlines forced to operate under capacity

The Saigon Times

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HCMC – The Mekong Delta province of Ca Mau plans to offer annual financial assistance totaling VND7 billion to airlines operating flights below capacity to and from the southernmost province’s airport.

Due to Ca Mau Airport’s inadequate facilities, airlines including Bamboo Airways using its 98-seat E190 aircraft are forced to reduce their flight capacity, thus affecting their profitability, said Nguyen Tien Hai, secretary of Ca Mau’s Party Committee and chairman of the provincial People’s Council.

Ca Mau Airport is classified as meeting level 3C standards of the International Civil Aviation Organization (ICAO).

While the airport’s upgrade plan is underway, the local government will provide assistance to airlines flying to Ca Mau Airport that are required to reduce passenger loads there.

The financial assistance for sustaining air services will be determined based on specific ticket prices, with the compensation equivalent to 10% of the total number of passenger seats configured for each aircraft type. Flights exceeding 1,000 kilometers will receive VND3 million per seat; flights between 500 and 1,000 kilometers will receive VND2 million per seat, and flights under 500 kilometers will receive VND1.5 million per seat.

Airlines eligible for support must commit to year-round operation with at least six flights per week. The funding will be allocated from the provincial budget.

Hai said this plan is well-suited to the increasing passenger demand, and the total amount of the financial assistance will not exceed VND7 billion each year.

He emphasized that the initiative would contribute to the development of Ca Mau Province, making it more attractive to tourists and potential investors.

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