VietJet Reiterates Commitment To 200-Aircraft Boeing Order

Boeing

Stock Code:

BA

Date Founded:

1916-07-15

CEO:

Dave Calhoun

Headquarters Location:

Chicago, USA

Key Product Lines:

Boeing 737, Boeing 747, Boeing 757, Boeing 767, Boeing 777, Boeing 787

Business Type:

Planemaker

The Farnborough Airshow 2022 has thus far been full of good news on the aircraft order front for Boeing. One vital section of the order book is VietJet, as the Vietnamese low-cost carrier signed a rehashed agreement with the aircraft manufacturer, reaffirming a previously announced order for 200 Boeing 737 MAX aircraft.

New birds en route

VietJet had previously signed an initial deal for the Boeing 737 MAX in 2016 during a visit to Vietnam by then-US President Barack Obama. This deal was increased at the Farnborough Airshow 2018 when VietJet signed a Memorandum of Understanding for an additional 100 aircraft. The 2018 agreement included 80 Boeing 737 MAX 10s and 20 737 MAX 8s and was valued at more than $12.7 billion at then-current list prices. A year later, in 2019, the order doubled the total to 200 aircraft as part of VietJet's consistent growth.

This same order is now being reiterated three years later to showcase the airline's commitment, which some may have doubted due to the past couple of years of prolonged crisis. VietJet Managing Director Dinh Viet Phuong, said:

“Today’s agreement is a strategic move for VietJet and Boeing. It confirms both parties’ commitment to keeping up with VietJet’s international flight network expansion plan with a higher capacity, thus offering our passengers more exciting experiences when being able to fly to more new international destinations in the post-pandemic period."

Using international finance sources to invest in this modern fleet, the low-cost carrier plans to use the new-generation narrowbody to satisfy surging demand on high-density domestic routes. VietJet also wants to expand further to popular destinations throughout Asia by leveraging the aircraft's added capacity, specifically the Boeing 737 MAX 10.

The first 50 aircraft will be delivered to Thai VietJet, the affiliate company of VietJet and one of the leading domestic carriers in Thailand. As part of the agreement, Boeing will commit to supporting VietJet with technical services and training to ensure the best levels of affordability, efficiency, and reliability.

It is currently uncertain when Thai VietJet expects deliveries of the initial 50 aircraft. Photo: Boeing

Feeling MAXimum confidence

The Vietnamese low-cost carrier currently operates an all-Airbus fleet, consisting of the Airbus A320, A321, and A330. Once the massive Boeing order is completed, VietJet will become the largest Boeing 737 MAX 10 operator in Asia.

John Bruns, Vice President, India & Southeast Asia Sales & Marketing, Boeing Commercial Airplanes, celebrated the renewed win for the manufacturer by saying:

“We are honored to continue our partnership with VietJet to drive affordable passenger service in one of the world's fastest-growing aviation regions. The 737 MAX, with its efficiency, flexibility, and capability, will support VietJet’s goal to grow its route network in Asia."

Undoubtedly, the enormous confirmation also helps Boeing shake off some nervousness over the 737 MAX 8, which has been plagued by years of unfortunate luck. The planemaker has made extensive fixes to the model following the accidents, and most regulators worldwide have now approved the aircraft to fly again.

Still, Boeing has been trying to further market the 737 MAX in the Asia-Pacific region, and this year's airshow has helped with the manufacturer's goal. Besides VietJet, Boeing has secured another 737 MAX deal in the region as ANA is set to become the first Japanese airline to operate the Boeing 737 MAX 8.

Boeing has sold more than 630 of the MAX 10s to date. Photo: Tom Boon | Simple Flying

Bottom line

Boeing has been dealing with numerous uncertainties regarding its game-changing narrowbodies. While the aircraft manufacturer can still count its wins in this year's airshow, it still has its work cut out to prepare for winning approval for the 737 MAX 10 by December. Failure to meet the deadline for certification approval could set Boeing back several paces, something that could be costly for the 737 MAX 10 program and further damage the reputation of the MAX family.