Vietnam Overtakes Thailand as ASEAN's Second-Largest Aviation Market

HANOI, Vietnam – Vietnam has overtaken Thailand to become the second-largest aviation market in Southeast Asia by passenger seat capacity, driven by airlines adding flights to meet rising international tourism demand, according to aviation data from OAG. OAG data showed Southeast Asia’s airlines offered a combined 50.4 million seats in July 2026. Indonesia remained the region’s largest aviation market with 10.9 million seats, up 0.3% year-on-year. Vietnam ranked second with 7.4 million seats, a 5.6% increase from July 2025, while Thailand dropped to third place with 6.9 million seats. Malaysia followed with 5.2 million seats, ahead of the Philippines with 4.9 million and Singapore with 3.6 million. The rise of Vietnam’s aviation sector came despite a slight decline in overall regional capacity, which fell 1.2% year-on-year in July. The growth reflects Vietnam’s continued recovery in international tourism. The country welcomed 1.67 million foreign visitors in July, up 6.6% compared with the same month last year, according to Vietnam’s National Statistics Office. During the first seven months of 2026, Vietnam recorded 13.9 million international arrivals, an increase of 13.8% year-on-year, reaching around 56% of the government’s annual target of 25 million foreign visitors. Vietnam Airlines was the largest airline in Southeast Asia in July, with 2.8 million available seats, according to the report. Across the region, full-service airlines continued expanding, offering 28.3 million seats and capturing a 56% market share, up 5% year-on-year. Meanwhile, low-cost carriers saw capacity fall 8.1% to 22.1 million seats, reducing their market share from 47% to 44%. The growth of full-service carriers was led by Vietnam Airlines, Singapore Airlines and Batik Air, while low-cost airlines including AirAsia, Lion Air and Thai AirAsia reduced capacity. The latest figures highlight growing competition among Southeast Asian tourism hubs, with Vietnam rapidly strengthening its position as a major regional aviation and travel market.