VietJet orders more Airbus jets one day after major Boeing deal
The battle between Boeing and Airbus for market share in one of Southeast Asia’s soaring markets has just intensified. At the Farnborough International Airshow, on July 18, 2018, Boeing struck a new deal with Vietnamese budget carrier VietJet Air, by which the airline provisionally ordered additional 100 Boeing 737 MAX passenger jets. Just a day later, the airline placed another provisional order at the Airshow, this time for additional 50 Airbus A321neo jets. Seems like VietJet just cannot stay away from Airbus, having operated an all-Airbus fleet since the beginning.
The Boeing deal
On July 18, 2018, Boeing and VietJet Air signed a Memorandum of Understanding (MoU) at the Farnborough International Airshow for an additional 100 737 MAX airplanes. The agreement includes 80 737 MAX 10s and 20 737 MAX 8s, and is valued at more than $12.7 billion at current list prices.
Once the deal is completed, the Vietnamese low-cost carrier will become the largest MAX 10 customer in Asia. VietJet plans to leverage the added capacity of the MAX 10 to satisfy surging demand on high-dense domestic routes, as well as on popular destinations throughout the continent, as the deal would double the carrier's 737 MAX fleet to 200.
Nguyễn Thị Phương Thảo, President and CEO of VietJet, had this to say: “These new airplanes will fit perfectly into our growth strategy, providing the efficiency and range for VietJet to expand its route network and offer more international destinations for our customers and expand alliances across Asia Pacific, the fastest growing aviation market in the world."
In addition, as part of the agreement, Boeing would partner with VietJet to enhance technical and engineering expertise and the training of pilots and technicians in Vietnam, to further develop commercial aviation in the country. The U.S. plane maker will also support the Vietnamese carrier in improving management capabilities at the airline and in the country.
According to Boeing, in 2016, VietJet finalized an order for 100 737 MAX 8 jets, which set the mark for the largest-ever single commercial airplane purchase in Vietnamese aviation. However, the company’s orders and deliveries book indicates that the order for the 100 MAX 8s is unfilled.
Nevertheless, Kevin McAllister, president and CEO of Boeing Commercial Airplanes, said this on the recent order: "We are honored to deepen our strong partnership with VietJet as they become our newest 737 MAX 10 customer.”
“With this agreement, we take another major step in growing our partnership with VietJet, one that continues to contribute to the trade relationship between Vietnam and the United States. This agreement also grows Boeing's presence and partnerships across Asia Pacific, developing win-win partnerships in a region with tremendous development potential," McAllister added.
The Airbus deal
On July 19, 2018, VietJet Air signed a Memorandum of Understanding (MoU) with Airbus at the Farnborough International Airshow for the purchase of an additional 50 A321neo single-aisle jets. Although the total price of the deal is not specified, the A321neo is valued $129.5 million at current list prices.
According to Airbus, this latest agreement will see the Vietnamese carrier’s backlog of orders for the A320 Family rise to 129 aircraft, including 123 A321neos and six A321ceos. Vietjet intends to use the additional aircraft to meet the growing demand for its services on both its domestic and international networks.
Ever since Vietjet first took to the skies in 2011, it had operated an all-Airbus fleet, which currently comprises more than 50 A320 Family aircraft: the A320-200, A321-200 and A321neo; the average age of the fleet being three years, as Plane Spotters data indicates.