National flag carrier Vietnam Airlines signed a memorandum of understanding with U.S. plane maker Boeing in Hanoi on Monday to buy 50 Boeing 737 Max aircraft for US$10 billion during U.S. President Joe Biden’s two-day state visit to Vietnam, which wrapped up on the same day.

As per the deal, the two sides will coordinate to study and evaluate the airline’s financial health and the feasibility of the purchase plan to report to authorities for consideration.

These planes are slated for delivery between 2027 and 2030.

Vietnamese Airlines chairman Dang Ngoc Hoa said that the air carrier is working to expand its aircraft fleet in the 2025-30 period, with a vision toward 2035. 

“Investment in planes is one of the airline’s key strategies for recovery and sustainable development, helping perfect its fleet of modern and fuel-efficient jets,” he said.

Brad McMullen, senior vice-president for Boeing Commercial Airplanes, said that the Boeing 737 MAX is a suitable selection for Vietnam Airlines to meet demands in the region.

These narrow-body airliners will strengthen its fleet to operate on air routes in Southeast Asia and help reduce carbon dioxide emissions.

The Boeing 737 MAX aircraft, equipped with 150-230 seats each, is currently being used by 70 airlines worldwide.

After adding Boeing B737 MAX jets to its fleet, Vietnam Airlines will receive technology transfer of a new aircraft generation and develop infrastructure for maintenance and repair at Long Thanh International Airport in Dong Nai Province, a neighbor of Ho Chi Minh City. The airport is being built there.

Tran Thanh Hien, financial manager at Vietnam Airlines, told reporters on the sidelines of the signing ceremony that carriers and Vietnam Airlines are short of funds due to the COVID-19 pandemic.

However, the planned purchase is part of the air carrier’s development scheme, so the airline is preparing to mobilize capital for such a big deal.

Vietnam Airlines expects to secure financial support from Boeing, the U.S. government, and other financial institutions to complete the purchase, said Hien. 

The national carrier has 100 aircraft, including 65 narrow-body jets, and operates over 97 domestic and international air routes.

To boost its growth and meet the travel needs of passengers, the airline plans to add around 60 planes to its fleet by 2030 and another 100 by 2035.

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