Airbus has agreed to sell 40 jets to Vietnamese airlines in deals worth an estimated $6.5 billion, the European planemaker said on Tuesday, a key milestone in a fast-growing and competitive aviation market.
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Both deals, in addition to a 20 aircraft order by low-priced carrier VietJet Air for 20 additional A321s, were presided over by Vietnamese president Tran Dai Quang, and French president Francois Hollande. The list price for the deals is $3.1 billion and $980 million respectively, though purchasers usually negotiate discounts.
Vietnam Airlines now has four aircraft in service, with another ten on firm order for future delivery.
The order underscores the rapid expansion of the budget carrier since it began operating in 2011. In addition to Tuesday’s announcement and the previous $11 billion order with Boeing to buy 737 jets, unveiled during U.S. President Barack Obama’s visit to the country in May, VietJet agreed past year to buy 30 Airbus A321 planes for $3.6 billion.
Vietnam is expected to rank among the world’s 10 fastest-growing aviation markets in the next two decades, according to the International Air Transport Association. In May, the country’s only private airline said it would buy 100 Boeing 737-Max 200 jets in an order worth $11.3 billion when U.S. President Barack Obama visited Vietnam.
Strong economic growth and a burgeoning middle class has increased demand for travel both domestically and overseas, spurring carriers to increase routes.
Vietnam Airlines has signed a memorandum of understanding for 10 Airbus A350-900 aircraft, while unit Jetstar Pacific has confirmed an order for 10 A320s.
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Based in Ho Chi Minh City, Jetstar Pacific is a joint venture between Vietnam Airlines (70%) and the Qantas Group (30%).
