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Lao Airlines’ Earnings Nosedive By 70 Percent In 2020

Source: Vientiane Times

Lao Airlines’ earnings plummeted by 70 percent last year compared to 2019 as result of a sharp drop in passenger numbers due to the Covid-19 pandemic.

The figure was reported at a recent meeting of the airline’s sales representatives and related parties. The meeting was held for Lao Airlines’ staff and ticket agents to discuss ways to improve the services offered by the airline in order to attract more customers.

Speaking at the meeting, the Lao Airlines President, Mr Khamla Phommavanh, said “The pandemic has had a devastating impact, not only on Lao Airlines, but on airlines the world over.”

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“Last year we carried almost 380,000 passengers on 6,645 flights, both within Laos and internationally, which was just 30 percent of the number we carried in 2019,” he added.

“The amount earned by our sales representatives also fell massively, from US$31 million in 2019 to US$13 million last year. The pandemic has not only affected aviation but other businesses related to tourism, such as travel agents, hotels, and restaurants.”

According to Lao Airlines, the pandemic is the biggest shock to hit the aviation industry since World War 2. Globally, revenue passenger kilometres are estimated to have dropped by up to 66 percent.

To survive this challenging situation, Lao Airlines is targeting domestic passengers and is advertising a raft of special offers to encourage more people to travel to destinations within Laos.

“The airline has been hit hard by the pandemic because we have had to suspend all international routes,” the Director of the Commercial Department, Mr Noudeng Chanthaphasouk, said.

“Since Lao Airlines is quite small we have managed to survive by flying only domestic routes but we also face other challenges. Our operating costs are increasing because of the rising price of jet fuel while the weakening value of the kip has put added pressure on our business,” he added.

Lao Airlines’ only international route at present is the Vientiane to Kunming sector, with flights to and from China taking place twice a week.

The Covid-19 prevention measures on this route have not changed and passengers have to stay for two weeks in a quarantine centre.

The temperature of both passengers and crew members is checked before they enter the aircraft, passengers have to pick up drinking water by themselves at the plane’s entrance and maintain social distance.