Vietnam to buy 12 Boeing 787-8 Dreamliners worth US$ 2.1 billion

Vietnam and US aircraft maker Boeing on Friday signed deals for twelve 787-8 Dreamliners to help the state-run carrier modernize its fleet and meet surging air travel demand.

Vietnam Airlines agreed to buy four of the large passenger jets, and the newly formed Vietnam Aircraft Leasing Company (VALC) will buy eight of the twin-aisle aircraft to lease out to the airline.

VALC said the eight planes it bought, to be delivered from 2016 onward, would cost a combined US$ 1.4 billion, putting the total price tag for the 12 aircraft at about $ 2.1 billion.

This is the most advanced aircraft in Boeing’s flock. Under the contract, VALC will receive the first aircraft by 2016.

The Ha Noi based aircraft leasing company is the first one of its kind in Viet Nam, which is seen as a major move in liberalising the airline industry.

Vietnam Airlines has already signed a contract to hire all of VALC’s eight aircraft once they are available. VALC’s first major client will be Vietnam Airlines but VALC said it also plans to target other companies in the region.

Many companies in the region are lining up to buy new planes, said Pham Ngoc Minh, vice president of Vietnam Airlines and chairman of VALC. “If we don’t make a quick and bold move now, the delivery of the planes would have to be pushed back further,” Minh said.

VALC has VND640 billion ($ 40 million) in charter capital. Under the proposed development plan, the company will raise its charter capital to at least $ 200 million in its first phase from 2007-2014, and to $1 billion by 2025.

The company’s founding shareholders include major State enterprises: Vietnam Airlines holds 23 per cent, the Bank for Investment and Development of Viet Nam (BIDV) 20 per cent, the Viet Nam Oil and Gas Group (PetroVietnam) 17 per cent and the Viet Nam Shipbuilding Industry Group (Vinashin) 11 per cent. Phong Phu Corp, a leading textile producer, contributes 8 per cent.

Vietnam Airlines now has 46 aircraft in its fleet. Two years ago it said it planned to have 80 planes by 2015 and 110 by 2020.

To date, Boeing has won more than 700 orders for the 787, while Airbus has received 154 firm orders and 110 nonbinding commitments for the similarly sized A350, which is scheduled to enter service in 2013.

Read more …

Vietnam News, 17 Nov 2007.

AP/Newsvine, 16 Nov 2007

Thanh Nien Online, 17 Nov 2007.

Boeing Commercial Airplanes – News Releases