Dubai: Vietnamese low cost carrier, Vietjet, announced on Tuesday it is buying 30 Airbus A321s in what is the first major commercial aircraft order of the 2015 Dubai Airshow.
The airline ordered 9 A321ceos (current engine option) and 21 A321neos (new engine options), narrow body single aisle aircraft, to be delivered from 2016 until 2022. The deal is valued at $3.6 billion (Dh13.22 billion) at list prices. However, Airbus’s John Leahy, Chief Operating Officer for customer sales, told reporters the airline received a discount, which is common for large orders.
Viejet’s Tuesday order is the first major new deal of the 2015 Dubai Airshow, which so far is lagging behind the record sales of 2013 when Boeing and Airbus sold $140 billion in aircraft. On Monday, India’s Jet Airways confirmed a previously announced order to buy 75 Boeing 737MAX aircraft worth $8 billion at list prices.
Asked if Vietjet thought it got a better deal because the show had been quiet compared to previous years, Vietjet President and Chief Executive Nguyen Thi Phuong Thao said the order was a “win-win” for Airbus and the airline.
The deal went to the eleventh hour with Airbus delaying the announcement four times as executives negotiated over the fine print. At one point Airbus even told the reporters the announcement had been postponed until further notice to just moments later confirming it would go ahead after all.
Neither Airbus nor Vietjet disclosed what was the deciding factor with Airbus’ Leahy telling reporters details of the agreement were confidential. But, following the announcement, Thao did tell reporters the airline is “very happy”.
Vietjet’s will use the 30 A321s it ordered on Tuesday to launch for expansion and to launch new routes in Asia to Japan, China, South Korea and India.
“We’re growing faster than expected,” Thao said.
Vietjet currently operates 35 across Vietnam and to Thailand, Singapore, South Korea, Taiwan and Myanmar.
Thao also said Vietjet was considering plans to increase its fleet again beyond Tuesday’s announcement so it could launch flights to the Middle East. Vietjet fleet currently only consists of Airbus A320s and A321s, narrow body aircraft that do not have the range to fly to the Middle East from Southeast Asia.
Thao said the A321ceos ordered on Tuesday will be powered by CFM International engines, a joint venture between the US’ General Electric (GE) and France’s Safran. She said no decision has been made on which engines will be used for the A321neos. The A321ceos will have 230 seats in an all economy class cabin, the same amount as the current A321ceos in the Vietjet fleet, and the A321neos will have 240 seats in an all economy class cabin.
Tuesday’s announcement was Vietjet’s third ever Airbus order. In February 2014, it ordered 63 Airbus A320s at the Singapore Air Show and in June 2015, ordered six A321s at the Paris Air Show.
