BAMBOO AIRWAYS: Exits Australia, and other long-haul destinations

Vietnam-based airline Bamboo has just announced that it will cease all its long-haul services. That means abandoning flights to Europe and Australia as it adopts a downsizing strategy hoping to ‘shrink to survive’.

This directly impacts Australia, as Bamboo will cease flying its Dreamliner Boeing 787-9s between Ho Chi Minh City (Saigon), Sydney and Melbourne, and between Hanoi and Melbourne, this month.

Background

While seeming abrupt, this move was foreshadowed by a series of events reported over the last 18 months by various news outlets. These included the arrest of a former chairman in March 2022 over alleged stock market manipulation, a new CEO that lasted a month, and the non, or part payment of overseas pilots more recently. None of these events augured well.

Bamboo Airways was set up to sit in the market between full-service carrier Vietnam Airlines and low-cost VietJet. It pursued an aggressive expansion policy, which drew comments from sceptics at the time. Losing over US$ 700 million last year, the writing was on the wall. When none, or late payment of pilots – in an international pilot shortage started being reported earlier this year, the nails were standing ready in close proximity to the coffin.

New Strategy

Essentially, Bamboo will adopt a strategy very similar to Virgin Australia. It’s going to reduce the number of aircraft types it has in its fleet, reducing the fleet to single-aisle aircraft. That means there will be a bunch of Dreamliners up for sale as they eliminate the aircraft from the fleet.

The statement is low on specifics but indicates a general slimming and simplifying direction:

‘The carrier’s fleet structure is expected to incorporate narrow-body aircraft and jets, which will be deployed on key domestic routes, strongly emphasizing trunk routes such as Hanoi, Ho Chi Minh City, and Da Nang. The airline will also offer services on domestic tourist routes with high demand and international routes to Southeast Asia.’

Bamboo News

That means goodbye, Australia!

Routes cut

Bamboo Airways had served 17 domestic and nine international destinations. It is set to abandon routes between Vietnam, Melbourne, Sydney, London and Frankfurt in line with the statement. Asian destinations such as Bangkok, Taipei, Soul, Singapore and Tokyo may survive, depending on their current income-earning capacity. Domestic destinations will be subject to the same measure, with the least income generating on the chopping block. Popular routes like between the southern and northern centres, Ho Chi Minh City and Hanoi, and tourist destinations will likely remain.

2PAXfly Takeout

This is sad news for a promising new airline. Bamboo assumed a fairly aggressive strategy when it entered the Australian market in early 2022. It was confident that the Vietnamese diaspora, plus the popularity of the country amongst Australian tourists, would sustain its growth. That may have been true and may still be true. But with competition from low-cost VietJet and what looks like bad, if not mismanagement, from its executive and board, the challenge was more than this airline could take.

I never got the chance to fly with them or experience what, by all reports, was a great experience, including their Collins ‘Super Diamond’ seating.