Boeing Expected to Ink $3 Billion Deal with Vietnam’s Bamboo Airways

February 26, 2019, 10:02 AM UTC
Vietnam's newly launched Bamboo Airways took flight on January 16 and to aims fly to the U.S. later this year or early 2020. MANAN VATSYAYANA AFP/Getty Images
Manan Vatsyayana—AFP/Getty Images

Vietnam’s Bamboo Airways plans to order as many as 25 narrow- and wide-body Boeing Co. aircraft this year as the nation’s newest carrier prepares for flights to the U.S. and Europe, according to people familiar with the matter, who asked not to be identified because negotiations are underway.

The deal would increase Bamboo Airways’ Boeing fleet to 55. The carrier’s parent, property and leisure company FLC Group, agreed last year to buy 24 Airbus SE A321neo planes worth $3.2 billion at list price. The airline began service in January.

A Bamboo Airways representative declined to comment on the potential deal.

FLC shares rose as much as 2.6 percent to the highest level in almost six weeks while the benchmark VN Index fell 0.7 percent.

Bamboo Airways will sign a separate deal with Boeing to buy 10 Boeing 787-9 Dreamliners worth about $3 billion Wednesday, ahead of U.S. President Donald Trump and North Korean leader Kim Jong Un’s summit in Hanoi. In June, it signed a commitment for 20 Boeing Co. 787-9 Dreamliners with a list price of $5.6 billion before customary discounts.

Bamboo Airways said it plans to fly to the U.S. later this year or early 2020, according to a statement on its website. The carrier is considering routes to Seattle, Los Angeles and San Francisco.

The U.S. Federal Aviation Administration this month gave its approval to Vietnam’s air-safety system, which will allow the Southeast Asian country’s airlines to fly to the U.S. as it seeks to bolster tourism.