Vietnam Airlines Offers $10 Billion for 50 Boeing Aircraft
During U.S. President Joe Biden’s visit to Vietnam, national flag carrier Vietnam Airlines signed a memorandum of understanding to acquire 50 Boeing 737 Max aircraft for a total of $10 billion. The delivery of these aircraft is scheduled between 2027 and 2030. The agreement entails a joint evaluation of the feasibility of the plan, which will be reported to the relevant authorities for consideration.
Dang Ngoc Hoa, Chairman of the Board of Directors of Vietnam Airlines, stated that the airline aims to enhance its fleet development from 2025 to 2030, with a vision extending to 2035. The investment in aircraft plays a crucial role in helping the company achieve its targets during the post-pandemic recovery period. Additionally, this project will contribute to improving the quality of domestic and regional flight routes. Vietnam Airlines plans to add approximately 60 narrow-body aircraft by 2030 and eventually accumulate around 100 by 2035.
The Boeing 737 Max, a narrow-body aircraft with 150-230 seats, is utilized by 70 airlines worldwide, with over 1,150 operational aircraft. Vietnam Airlines and Boeing held a press conference to disclose the details of the deal. Tran Thanh Hien, CFO of Vietnam Airlines, acknowledged the ongoing recovery of Vietnam’s airline industry after the pandemic. However, he emphasized that the fleet development plan aligns with the company’s long-term strategy and future requirements. Vietnam Airlines will undertake the necessary procedures, including capital raising, over the next 3-4 years to ensure the feasibility and effectiveness of the project.
Hien expressed confidence in securing the capital for the project through an overall restructuring process. He also highlighted the anticipated support from Boeing, the U.S. government, and financial institutions in facilitating the purchase of the 50 planes. Additionally, Vietnam Airlines will collaborate with domestic organizations to arrange short and medium-term capital solutions for PDP Financing, sales, and leaseback.
Addressing concerns about operating two narrow-body aircraft lines simultaneously (Boeing and Airbus), CEO Le Hong Ha reassured that Vietnam Airlines possesses the experience and highly qualified engineering staff to successfully manage and maintain both the Airbus A350 and Boeing 787. Consequently, the maintenance and repair of the Boeing 737 Max aircraft will not pose significant challenges.