HANOI – Vietnam Airlines (VNA) and the U.S.-based Air Lease Corporation (ALC) have signed a comprehensive fleet restructuring agreement linked to the national flag carrier’s leasing of 18 aircraft, including 12 Airbus A321neos and six Boeing B787-10s, during the remaining lease term under their contract.
The deal came after a long period of negotiations because Vietnam’s biggest airline by fleet is struggling with difficulties caused by the Covid-19 pandemic.
Vietnam Airlines and ALC also reviewed the aircraft lease provisions based on the economic and aviation recovery in Vietnam and Southeast Asia.
The deal is an important achievement of VNA in its attempt to restructure its fleet, save more aircraft-related costs, balance its cash flow and ride out pandemic-induced woes.
As for ALC, it is among the world’s largest aircraft leasing companies, headquartered in Los Angeles. It is also currently the largest business partner that leases aircraft to the Vietnamese carrier.
Vietnam Airlines has 107 aircraft, so aircraft-related costs account for a large proportion of its total expenses. Meanwhile, many air routes have been suspended due to the pandemic. Therefore, fleet restructuring and cost reduction are considered strategic measures to enable the airline to cope with the hardship.
The airline has taken multiple measures to improve revenue, cut costs, minimize financial losses and damages caused by the pandemic. It has targeted optimizing cost restructuring to improve operation efficiency, competitiveness and sustainable development.