VALC IN AGREEMENT WITH IAE FOR 10 A321-200S

Dino D'Amore
By Dino D'Amore December 8, 2010 11:09

VALC IN AGREEMENT WITH IAE FOR 10 A321-200S

Vietnam Aircraft Leasing Company (VALC) yesterday signed an agreement with International Aero Engines AG (IAE) to purchase 20 V2533-A5 engines to power 10 new Airbus A321-200 aircraft on order.

The engine contract is valued at more than US$184 million with deliveries being made from July 2012 to 2013. The engine is designed to provide an additional one per cent fuel burn advantage, along with a corresponding reduction in CO2 emissions. It also improves time-on-wing by up to 20 per cent.

VALC’s president and CEO Tran Long confirmed that the total investment for the purchase of the 10 aircrafts and 20 engines was more than $700 million and the project is expected to fetch a profit equalling 12-15% of its equity.

The new aircraft will be operated by Vietnam Airlines (VNA). VALC has leased VNA four out of five ATR72-500 aircraft as planned. The last aircraft will be delivered late this month. The monthly lease for each is over $200,000, which is fixed for 11 years and 11 months.

Since its establishment in 2007, VALC, founded by state-owned Bank for Development and Investment of Vietnam (BIDV) and the national flag carrier Vietnam Airlines (VNA) in 2007 pursuant to the Prime Minister’s instructions, has just signed a contract with Vietnam Airlines even though Vietnam has four other airlines.

“We target both domestic and regional markets. However, in Vietnam, excluding Vietnam Airlines, other airlines are still weak and small. I think we may have to wait at least to 2014 to expand,” Long said.

Dino D'Amore
By Dino D'Amore December 8, 2010 11:09
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