Fuel firm promises supplies to struggling airline

Vietnam Air Petrol Company said it would continue to supply fuel to Indochina Airlines despite the company’s crippling debt and financial troubles.

The state-owned fuel supplier, also known as Vinapco, said it would sell fuel to Indochina when the carrier resumes its service later this month only on a pay in advance basis as the private airline has not managed to clear unpaid bills totaling VND18 billion (US$1 million) yet.

Vinapco Director Tran Huu Phuc said Indochina had suspended its services independently and that Vinapco had not cut off supplies to the ariline.

The monopoly fuel supplier, an affiliate of national carrier Vietnam Airlines, had warned Indochina Airlines in June that it would cut off supplies if the debts were not cleared.

The Civil Aviation Administration of Vietnam did not allow Vinapco to do so, fearing the effect on travelers in the country.

CAAV Deputy Director Lai Xuan Thanh was quoted by Thoi Bao Kinh Te Saigon (Saigon Economic Times) Thursday as saying that even though his administration already proposed that the Ministry of Transport consider revoking Indochina’s license, service suppliers were not allowed to cut off provisions to airlines.

Thanh also said Indochina would be given the opportunity to maintain its services as long as it could meet all the financial requirements.

Indochina said in a statement last week it would suspend its lone Hanoi-Ho Chi Minh City service until November 26 as it didn’t have enough customers to afford fuel costs.

VietNamNet/Thanh Nien/TBKTSG

Tags: Vietnam airlines, Vietnam aviation industry, Vietnam business news