I came across this short clip by CNBC on the dominance of Boeing and Airbus in the sky. The two companies are the two major players in a lucrative industry with incredible high entry barriers. They or at least Boeing has a close tie to the government as it is the second biggest vendor for government contracts.
It’s a bit ironic that Boeing enjoys the influence and the lack of the competition that it has while government officials all seem eager to publicly end the alleged monopolies of tech companies. I said alleged since it’s not really clear cut to determine whether companies like Amazon are a monopoly even though many deem it to be. I am not saying that tech companies should be allowed to function in a monopolistic competition. But if fighting to avoid monopolies and to preserve consumers’ best interest is necessary, Boeing should be one of the first companies to be scrutinized.
If you remember the saga Boeing has had with its 737 Max this year, it’s even more unbelievable to see Boeing dominate the market. Even with its position and power, Boeing still tries to cut cost and bolster the bottom line at the expense of the very utmost thing they should be responsible for: safety.
Last month, Vietnam Electricity (EVN), the state-owned company that has a monopoly over electricity in Vietnam, announced an 8% price hike, citing an increase in production cost. Obviously, it leads to the hike in everything’s price and living cost overall. But what frustrates me the most is the fact that as a monopoly, the company is terribly run. It invests in other verticals where it doesn’t have the knowledge or capabilities, on top of a terrible management, something that is not uncommon in Vietnam. As a consequence, EVN suffered huge financial losses. According to this article, EVN’s loss amounts to $94 million, despite having the monopoly. The loss includes ridiculous expenses such as building a golf course or luxury villas for the company’s officials. To cover these losses, it routinely jacks up the electricity price. There is almost no oversight.
Even more frustratingly and shamelessly, they hiked the electricity price during the hottest season the country has even encountered. The highest temp recorded is 43.4°C (110.12°F). At 6AM, it’s already at 87.8°F.
This kind of egregious behavior isn’t exclusive to EVN. Gas price in Vietnam frequently increases, thanks to Petrolimex, another monopoly. The problem is that once these crucial commodities become more expensive, everything else will as well. When the price of the commodities is lowered; however, the living cost rarely follows or gets cheaper. Meanwhile, the wage in Vietnam is not even close to keeping up with the rising living cost, rendering whatever income an ordinary folk earns increasingly small.
I love my country. We have great cuisine and sceneries as well as an authentic culture. However, I don’t want to live in a place where I cannot meaningfully save anything simply because living costs increase almost on a monthly/quarterly basis while wage does once a year at most. This and among other reasons I will share in the future whenever it is appropriate