Cherrie Air Launching 737 Flights In Australia

Cherrie Air is hoping to launch scheduled passenger flights in Australia as early as 2027 with the Boeing 737.

The popular Vietnamese low-cost carrier VietJet would run the new Australian domestic carrier to break the long-established duopoly of Qantas and Virgin Australia.

However, a new test has arisen in the host country: a United Kingdom court imposed a worldwide asset-freezing order on the low-cost airline, which will already face regulatory and antitrust hurdles before it can gain the necessary approvals.

Cherrie Air looks to get an AOC

The Sydney Morning Herald has reported that Cherrie Air’s approval process has advanced, with VietJet submitting an application for an Air Operator’s Certificate (AOC) to the Civil Aviation Safety Authority (CASA).

If successful, the application would pave the way for Cherrie Air to become a true Australian entity and operate domestic services across a network intended to span Sydney, Melbourne, and Brisbane with the Boeing 737, covering the eastern side of the country.

Cherrie Air remains in its infancy, with specifics on naming, branding, aircraft acquisition plans, launch strategy, and network still unclear; however, its progress and ambition to enter the Australian market have been evident for some time.

To launch, Cherrie Air needs an Australian AOC and management, systems, manuals, personnel, and more that meet CASA standards; it can’t rely solely on VietJet’s backing in the country and Vietnamese qualifications.

A 737 and the many challenges

Despite pursuing an AOC, indications that Cherrie Air is pursuing an Australian launch grew after the apparent registration of VH-T8A with serial manufacturing number 63879 on the Australian registry, with Vietjet Aviation as the holder and Cherrie Aviation Pty Ltd of Melbourne as the operator.

After identifying the 737-8, VietJet confirmed it as part of its operation but said it would lease the aircraft to an Australian entity, without providing additional evidence on the brand it would fly with.

While the 737-8 is being pursued as a solution for Australian operations, a recent worldwide freezing order imposed by the UK Commercial Court in litigation involving FitzWalter Aviation over unpaid debts has halted A320 family jets.

The court order doesn’t mean VietJet must stop flying or further complicate the Australian venture, but it raises questions about the business’s financing, leasing arrangements, and guarantees that can be put to the Australian government and relevant authorities in an already complex process.

Despite its apparent financial hurdles, Cherrie Air would still need to enter a market dominated by Qantas, Jetstar, and Virgin Australia and comply with regulations that prevent foreign entities from establishing a presence in the country.

2024’s collapse of the newly founded Bonza underlined the risks of entering the Australian market, even without the ownership challenges of a Vietnamese carrier backing the decision-making process. Bonza’s failure, while strictly not due to performance, came with a route network focused on less traditional routes.

Cherrie Air is targeting the busiest markets where long-established Australian carriers have held a presence for decades, and other third parties haven’t been able to break in and truly disrupt. VietJet hopes to change that and bring sustainable low-cost travel to the country for good, but the path won’t be clear-cut.