Boeing lands Vietnam deal worth $11 billion at list prices
In case you missed this news from Monday, Boeing secured an order from Vietnam's VietJet for 100 Boeing 737 MAX 200 jets. The deal would be valued at $11.3 billion a list prices, though airlines usually receive significant discounts on such orders.
The VietJet deal, the largest commercial airplane order in Vietnam's history, was revealed at a signing ceremony that coincided with President Obama's visit to Vietnam.
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Fast-growing VietJet – a low-cost carrier that launched in 2011 – has its sights set on expansion. The carrier says the new 737 MAX 200s will help fuel new domestic routes as well as new international routes.
The aircraft are expected to be delivered to VietJet between 2019 and 2023.
"Our investment in a fleet of B737 Max 200 will accommodate our strategy of growing Vietjet's coming international route network including long-haul flights," Vietjet CEO Nguyen Thi Phuong Thao said in a statement.
Reuters says the deal “represents a coup for Boeing, as VietJet has only operated its European rival Airbus' A320 airplanes since it began operations in December 2011.”
Dinesh Keskar, a Boeing senior vice president who handles sales in the region, acknowledged the competition with Airbus in comments to Bloomberg News.
“Certainly a 100-plane order will move the needle in our direction,” Kesker said. “The Vietnam low-cost-carrier market is a growing market and is going to be an important one in the future.”
The Vietjet deal comes as the U.S. and Vietnam have moved toward closer diplomatic and business ties in recent years.
Another deal that served as a public display of the warming relations came last July, when Vietnam’s top international carrier took delivery of its first Boeing 787 Dreamliner at a special pre-delivery ceremony at Washington's Reagan National Airport.
Such delivery ceremonies are common at Boeing's assembly line facilities near Seattle, but Vietnam Airlines opted to show off its first Dreamliner in the shadow of the U.S. Capitol. The symbolic move came near the 20-year anniversary of normalized diplomatic relations between the United States and Vietnam. The July 2015 ceremony also marked the first time that Vietnam Airlines opened its Dreamliner for public viewing.