AirAsia fails to take off in Vietnam, terminates the agreement to set up a joint venture

AirAsia ’s wholly-owned unit, AirAsia Investment Ltd, together with Gumin Company Ltd and Hai Au Aviation Joint Stock Company, have mutually agreed to terminate the agreement to set up a joint venture in Vietnam, effective April 17, 2019.

According to a report by The Star, AirAsia in a filing with Bursa Malaysia today said AirAsia Investment, Gumin and Hai Au Aviation have amicably agreed to terminate and release each other from all obligations under the transaction agreements in relation to the proposed joint venture in Vietnam.

“The company, nonetheless, remains interested in operating a low-cost airline in Vietnam due to its favourable geographical location, expanding aviation market and overall growth potential,” it said.

Related topic: AirAsia, the largest low-cost carrier in Southeast Asia to launch airline in Vietnam with local partner

the Malaysia-based carrier and Thien Minh Group, a Hanoi-based tourism business, agreed on Thursday to invest in aircraft to form a fleet for the new airline. TMG CEO Tran Trong Kien said that the fleet will mainly consist of Airbus A320s and A321s, both short- to medium-range, narrow-body aircraft.

“We expect to enhance our contribution to Vietnam’s aviation and increase locals in one of the most promising markets in the region,” AirAsia CEO Tony Fernandes said before signing agreement in December 2018.

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