Pacific Airlines (BL, Ho Chi Minh City) has suspended flights and returned its aircraft to lessors to facilitate a planned restructuring and debt write-down. According to local reports, the LCC could not meet its lease commitments on time and it paused flights and bookings on March 18.
In a statement, a Pacific Airlines spokesperson said the carrier “is currently restructuring its fleet and route network to ensure and enhance operational efficiency."
According to ch-aviation fleets data, the airline was leasing eight A320-200s but only one was active when it suspended services. Five of the aircraft came from Aviation Capital Group, two from Wings Capital Partners, and one from CALC. The airline reportedly returned the aircraft in exchange for the lessors wiping debts of around USD220 million. It will lease three aircraft from its state-owned parent Vietnam Airlines (VN, Hanoi Noi Bai International) while undergoing restructuring in order to retain its operating licence.
The airline began operations in 1991 as a cargo carrier before starting passenger flights later that decade. In 2007, Qantas Group acquired a 30% in the state-owned airline, rebranding it as Jetstar Pacific (Ho Chi Minh City), and in 2012 Vietnam Airlines acquired the remaining government-held 70% stake. At the time, there were plans to have as many as 30 aircraft flying for the LCC by 2020.
Pacific Airlines has consistently lost money. In calendar 2022, it recorded total revenues of VND3.49 trillion dong (USD140 million) and a pre-tax loss of VND2.1 trillion (USD84.5 million). As of December 31, 2022, its total accrued losses amounted to VND10.7 trillion (USD431.6 million) and its net equity reached VND6.7 trillion (USD270.3 million).
In 2020, Qantas Group handed over its 30% stake to Vietnam Airlines for a peppercorn amount and the Vietnamese flag carrier then rebranded the LCC back to Pacific Airlines.
The Civil Aviation Authority of Viet Nam (CAAV) instructed Pacific Airlines to submit a restructuring plan by March 22 and resume operations as quickly as possible. It also asked the carrier to temporarily surrender unused flight slots and ordered that passenger refunds be promptly processed. Pacific said it would rebook passengers onto Vietnam Airlines flights. That carrier had already committed to supporting its subsidiary by giving it access to its airport and ground service facilities.
Pacific Airlines has reportedly communicated with the CAAV, requesting that it "guide it through the restructuring processes and create favourable conditions" for a resumption of operations. However, it has not said when that might be.
