Vietnam Airlines scores $1 bln discount on jet lease
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Vietnam Airlines and Air Lease Corporation have agreed on a leasing discount exceeding $1 billion for 18 aircraft while the former face financial challenges amid the pandemic.
U.S.-based ALC, one of the biggest aircraft leasers in the world with 450 jets, will reduce leasing charges by $420 million for the rest of the contract duration of existing jets while the remaining $600 million will be discounted on new leases.
Vietnam Airlines is leasing 16 jets from ALC, comprising 12 narrow-body A321 Neo and four wide-body Boeing B787-10.
With the biggest fleet in Vietnam of over 100 jets, the national flag carrier is facing financial pressure in retaining its aircraft, with many routes suspended due to Covid-19.
Restructuring its fleet and cutting costs are its main goals to overcome the Covid-19 crisis, the airline stated.
CEO of the carrier Le Hong Ha said Tuesday the airline would have an oversupply of jets until 2025, and plans to sell 27 over the next two years.
Questions & Answers
Q.What is the total value of the leasing discount agreed between Vietnam Airlines and Air Lease Corporation?
What is the total value of the leasing discount agreed between Vietnam Airlines and Air Lease Corporation?
Vietnam Airlines has secured a discount exceeding $1 billion from Air Lease Corporation. This significant reduction in leasing costs comes as the airline grapples with financial difficulties during the pandemic.
Q.How will the $1 billion discount be distributed between existing and new aircraft leases?
How will the $1 billion discount be distributed between existing and new aircraft leases?
The discount is split into two parts. $420 million will reduce charges for existing jets for the remainder of their contract, while the remaining $600 million will be applied as a discount on new leases.
Q.Which specific types of aircraft does Vietnam Airlines lease from Air Lease Corporation?
Which specific types of aircraft does Vietnam Airlines lease from Air Lease Corporation?
Vietnam Airlines leases 16 jets from Air Lease Corporation. This fleet comprises 12 narrow-body A321 Neo aircraft and four wide-body Boeing B787-10 models, forming a part of its total fleet.
Q.What are Vietnam Airlines' plans for its aircraft fleet over the next two years?
What are Vietnam Airlines' plans for its aircraft fleet over the next two years?
The CEO stated Vietnam Airlines expects an oversupply of jets until 2025. The airline plans to address this by selling 27 aircraft over the next two years, aiming to restructure its fleet and cut costs.
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