HANOI- The Flag carrier Vietnam Airlines (VN) is currently grappling with financial challenges and is reportedly on the verge of finalizing an initial agreement to purchase around 50 Boeing 737 MAX jets, with an estimated total value of approximately $10 billion.
This development, if realized, would represent a significant milestone for Boeing, as it would facilitate the retirement of more than 40 older-generation Airbus A321 aircraft currently in the US carrier’s fleet, reports Bloomberg News.
Vietnam Airlines Boeing 737 MAX Order
Initially, Vietnam Airlines had been considering a substantial order for up to 50 Airbus A321neo aircraft; however, the deal with Boeing could alter its previous plans.
The agreement is anticipated to be officially confirmed through a memorandum of understanding during President Joe Biden’s visit to Vietnam.
Vietnam Airlines, which has exclusively operated single-aisle Airbus jets until now, is eager to modernize its aircraft fleet.
It is important to highlight that Vietnam Airlines has encountered financial hardships, primarily as a result of the prolonged effects of the COVID-19 pandemic and the complexities associated with reopening borders in the region.
The airline has consistently reported losses over several quarters, with a total loss of 10.1 trillion dong ($41 million) in 2022. These losses are largely attributed to the increasing costs of fuel and fluctuations in exchange rates.
Given these financial constraints, there may be difficulties in securing the necessary funds for such a significant aircraft order.
Additionally, obtaining new planes in the near term could prove challenging, as Airbus and Boeing currently have substantial order backlogs extending well into the next decade.
New 737 MAX Issues
In late August 2023, a new quality problem related to the Boeing 737 MAX involving its supplier Spirit AeroSystems came to light. The problem concerns incorrectly drilled holes on the aft pressure bulkhead, as disclosed by the aircraft manufacturer on Wednesday.
As a result of this defect, Boeing has been compelled to postpone deliveries in the near term. The company is also assessing the potential impact this issue might have on achieving its annual target of delivering a minimum of 400 737s for the year.
A fresh complication in the supply chain has arisen, becoming the latest hurdle in the delivery process of the revenue-generating MAX series, following Boeing’s revelation in April about improper bracket installation by Spirit that linked the aft fuselage to the vertical tail.
Boeing has confirmed that this recent issue will result in the postponement of the initial MAX 8 delivery to Malaysia Airlines (MH), which had originally been scheduled for August 28.
Spirit AeroSystems clarified that not all 737 fuselages will be affected by the new issue of “elongated” holes in the aft pressure bulkhead, as they source this component from multiple suppliers. They have expressed their belief that the issue will not significantly affect their delivery projections for the year.
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