2025-04-04T10:05:35.000Z

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HANOI – In a significant development for the aviation industry, Vietnamese budget airline VietJet is poised to sign a substantial financing deal worth $200 million. This agreement will be made in collaboration with AV Air Finance Company, a partner of the renowned investment firm KKR. The signing is set to take place at the Vietnamese embassy in Washington, D.C., on April 9, with the involvement of high-level officials, including Vietnam's Deputy Prime Minister Ho Duc Phoc.

This financing arrangement comes at a critical time for Vietnam, as the country is currently grappling with the implications of recent U.S. tariffs. Announced by the Trump administration, these tariffs aim to curtail Vietnam's significant trade surplus with the United States, introducing potential financial strains on various Vietnamese sectors, including aviation. The urgency of this deal reflects the government’s efforts to mitigate the economic impact of these tariffs.

According to an internal schedule viewed by Reuters, the agreement is primarily designed to support VietJet's aircraft purchases. However, the specifics of the financing deal raise questions regarding its purpose—whether it will contribute to a new order or enable the airline to place deposits for previously negotiated purchases. VietJet has an ongoing agreement to procure 200 Boeing 737 MAX jets, a deal initiated in 2016 that has yet to see any aircraft delivered.

Moreover, there are discussions underway regarding a potential order of 20 Boeing 787 jets, enhancing VietJet’s capacity and competitive edge in the market. A spokesperson from VietJet stated in January that the airline holds agreements with major U.S. corporations, including Boeing, amounting to nearly $50 billion, while actively negotiating additional contracts valued at approximately $14 billion.

Apart from the financing deal, the upcoming meeting between VietJet executives and Boeing representatives aims to solidify their strategic partnership and explore avenues for deeper collaboration. Boeing had previously indicated that it plans to deliver the first 14 of the already ordered 200 jets within this year, although further details remain sparse.

Despite inquiries about the financing deal, VietJet, KKR, and Vietnam’s foreign affairs ministry have not provided comments. Boeing, on the other hand, has directed all media inquiries back to VietJet.

In a related note, industry insiders have revealed that VietJet and Vietnam Airlines, the national flag carrier, are in negotiations to acquire additional passenger jets, although specifics regarding the potential suppliers have not been disclosed.

The backdrop of the U.S. tariffs has been a significant concern for Vietnamese officials, with many suggesting that the purchase of aircraft could serve as a strategic response to alleviate trade tensions with the U.S. The 46 percent tariffs on goods manufactured in Vietnam, which are set to take effect on April 9, have prompted the Vietnamese government to seek ways to negotiate relief from Washington.

In a proactive approach, Deputy Prime Minister Phoc is scheduled to travel to the U.S. starting April 6. However, the official agenda has yet to reveal any meetings with U.S. government officials regarding these pressing trade issues. Recently, Hanoi has proposed several concessions aimed at appeasing U.S. trade concerns, including lowering import duties and committing to increased purchases of U.S. goods.