Duong Tri Thanh, CEO, said at the national flag carrier’s annual general meeting Monday that its figures were improving in June and July with 18 new domestic routes launched. The number of domestic flights in the third week of July was over 500, up 40 percent year-on-year.

Thanh estimated that between May and July, the domestic aviation market had reached 90 percent of activity in the same period last year, much higher than other countries that had also contained the novel coronavirus, like Japan at 70 percent and China at 60 percent.

But, since the Covid-19 pandemic resurfaced in Vietnam on July 25, the number of flights by Vietnam Airlines has fallen down to the level early May, when the country began to ease social distancing measures and resumed economic activities.

"This second wave has not shut down Vietnam Airlines’ intentions to recover its business, but it has put more roadblocks on its path," Thanh said.

The airlines’ earlier plan to fully recover by 2022 might be pushed further back, he added.

Thanh forecast that in the last five months of the year, passenger numbers in Vietnam’s domestic market will fall 30 percent year-on-year. For the whole year, passenger numbers will drop 30-40 percent and ticket prices 30 percent, he estimated.

He said the carrier’s senior management has been working hard to steer the airline to recovery. It has negotiated with partners to delay debt repayment of VND2.4 trillion ($103 million) for this and next year. Local banks have also agreed to let the airline delay payments of VND775 billion.

Vietnam Airlines outgoing chairman Pham Ngoc Minh said the airline was in finalizing procedures seeking a VND4 trillion loan from the government and a VND8 trillion ($344 million) increase in charter capital. The government owns an 86.19 percent stake in the airline.

Shareholders of Vietnam Airlines on Monday voted with immediate effect to replace chairman Minh with the current deputy CEO, Dang Ngoc Hoa, as the former was retiring.

They also voted to remove two current board members, Nguyen Xuan Minh and Koji Shibata – a representative of Japan’s All Nippon Airways (ANA Holdings), which owns a 8.77 percent stake in the carrier.

These two will be replaced by three new board members. Two of them will be deputy CEOs Hoa and Le Hong Ha, and the other, Tomoji Ishii, senior vice president of ANA Holdings.

Vietnam Airlines recorded a loss of VND6.6 trillion ($285 million) in the first half of this year and has forecast this figure to reach VND15.1 trillion by the end of the year.

Its debt to equity ratio was 2.4 at the end of June and could rise to 12-14 by the end of the year.