DAVID FULLBROOK / SINGAPORE
A government handout of $1bn funds ambitious expansion plans in South-East Asia
Vietnam Airlines has signed a letter of intent (LOI) for the purchase of five Airbus A320 family aircraft as part of rapid expansion plans to meet rising tourist traffic. The carrier is already in advanced talks with Boeing to acquire 777s.
The South-East Asian carrier favours A321s in this latest Airbus deal but may order a mix of aircraft including A319s. "It's not confirmed but they will probably be A321s," says the airline. "We don't have a decision about the engines." The competition is between the CFM International CF56 and International Aero Engines V2500.
If a deal is signed, Vietnam Airlines wants delivery of the aircraft to begin in 2003, ending in late 2004 or 2005. Discussions to close the deal should begin in early October and be wrapped up in a few months, says the carrier. Vietnam Airlines indicated in June it intended to purchase its first A320s, which will be used on domestic and regional routes. A320 family aircraft have all been leased until now.
Contracts were also signed for Air France Industries to train, in France, around 20 pilots for Vietnam Airlines' 10 leased A320s and two A321s, and more maintenance engineers to perform C checks. Vietnam is using $3 million of development loans from the French Government to pay for the training.
Meanwhile, discussions continue with Boeing over the terms of a deal to supply four 777-200ERs for delivery beginning in late 2002.
"Right now we are trying to complete the contract with Boeing...it should be signed before the end of the year," says the airline. An LOI was signed during former US President Bill Clinton's visit in November 2000. Vietnam Airlines already operates 767-300ERs
The carrier received government approval in May to spend around $1 billion on new aircraft until 2005, bringing the fleet to 18 aircraft, and another $1 billion until 2010 to expand to 34 aircraft.
New routes to Beijing and Kunming are on course to open on 28 September and the end of October respectively.
Source: Flight International
