Vietnam’s largest conglomerate Vingroup JSC said on Tuesday it has scrapped a plan to launch an airline and will instead focus on technology development and industrial production.
The company last year applied for a license to launch an airline in 2020 but had yet to order any planes.
It has now notified the Ministry of Transport that it will withdraw from the aviation transport services sector.
“We need to focus our resources on the development of technologies and industrial production, and therefore we have decided to withdraw,” Chief Executive Nguyen Viet Quang said in a statement.
Quang said Vietnam’s aviation market has been developing rapidly but there are already several airlines, and that the group’s move to launch another carrier would lead to oversupply.
Vingroup, once a real estate and retail conglomerate, has grown to become Vietnam’s largest listed firm with a market capitalization of over $16 billion. It now also sells vehicles, television sets and smartphones and is looking to enter the artificial intelligence sector.
Vietnam’s aviation market has been growing at double-digit pace, attracting new entrants.
Property and leisure firm FLC Group JSC’s Bamboo Airways conducted its maiden commercial flight a year ago to become the country’s fifth airline.
Other companies, including Thien Minh Group and tour operator Vietravel, also aim to launch airlines this year.
Vingroup said it will continue to train pilots at its VinAviation academy.