Vietnam holds two Jetstar Execs over fuel hedging losses

written by australianaviation.com.au | January 10, 2010
Then Jetstar CEO Alan Joyce and then Jetstar Pacific CEO Luong Hoai Nam in 2007. (Jetstar)
Then Jetstar CEO Alan Joyce and then Jetstar Pacific CEO Luong Hoai Nam in 2007. (Jetstar)

The Vietnamese government has prevented two Australian executives of Jetstar Pacific, COO Daniela Marsilli and CFO Tristan Freeman, from leaving the country and is holding former CEO Luong Hoai Nam in custody as it investigates fuel hedging losses at the airline.

Marsilli (a former managing director of National Jet, now Cobham Aviation Services Australia) and Freeman are on secondment to Jetstar Pacific, in which the Qantas Group holds a 27 per cent stake. They were prevented from flying out of Vietnam on December 19 when they arrived at Ho Chi Minh Airport with their familes to fly to Australia for the Christmas break, while Vietnamese media have reported that former CEO Nam was taken into custody last Thursday.

According to Vietnamese media reports, the trio went against an airline board directive on fuel hedging, which contributed to losses of about $34 million last year. The price of fuel dropped dramatically in late 2008 and early 2009 on the back of the global financial crisis.

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Qantas Group CEO Alan Joyce has defended the actions of the executives, saying Jetstar Pacific wasn’t the only airline to incur big losses on fuel hedging in the past year. “The losses that were incurred were a part of global business risk,” he said on January 8, adding that the executives had not acted outside of their authority. “We’ll do whatever is necessary to ensure a speedy resolution.”

Jetstar Pacific operates five Boeing 737-400s and a single Airbus A320 on domestic routes. The Vietnamese government still holds 70 per cent of the airline.

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