Air Lease Corporation (ALC) has signed an agreement to cut leasing costs and alter aircraft deliveries for Vietnam Airlines (VN, Hanoi Noi Bai International), the Vietnamese government said in a statement. The deal was the culmination of a meeting between Prime Minister Phạm Minh Chính and ALC Executive Chairman Steven Udvar-Házy in Hanoi on December 15.

The comprehensive fleet restructuring agreement with the US-based lessor will help the majority state-owned flag carrier tackle its ongoing financial difficulties caused by the coronavirus pandemic. According to the statement, ALC will cut lease costs directly by USD420 million on existing contracts and annul previously signed contracts worth USD600 million.

Without providing specific details, the statement said that the deal relates to eighteen jets - twelve A321-200neo and six B787-10 aircraft. The two sides also reviewed leasing provisions to cover the future recovery in Vietnam and Southeast Asia.

According to the ch-aviation fleets and ch-aviation fleets ownership modules, Vietnam Airlines currently operates a total of twenty A321-200Ns and four B787-10s with an additional four of the latter on order. Air Lease Corporation owns and manages all four of the Boeing twinjets as well as the four not yet delivered.

ALC directly leases nine of the A321-200Ns in its portfolio to the carrier plus an additional two of the Airbus narrowbodies via its Irish subsidiary ALC Blarney Aircraft and one more through another subsidiary, Blackbird Capital.

The Los Angeles-based lessor is currently the biggest supplier of aircraft to Vietnam Airlines, and the carrier said in its statement that the agreement had been achieved after a lengthy negotiation process that the prime minister had personally monitored.

Vietnam Airlines currently operates a total fleet of 104 aircraft, 45 of which are leased. As previously reported, it revealed on December 14 that it plans to sell 12 of its owned aircraft in the next two years in addition to offloading 15 aircraft by the end of 2021.

During their meeting, the prime minister commented that Viet Nam was planning to resume some international routes, including to the United States, and Vietnam Airlines will take part in this process.

Udvar-Házy emphasised that during ALC's 20-year partnership with the flag carrier, Vietnam Airlines had always carried out its agreements with his company well and this bilateral cooperation is now at its best. He expressed his belief that once Vietnam reopens, with economic and tourism activities resumed, the airline will also recover and develop.

Responding to a request for comment, ALC confirmed to ch-aviation: “Air Lease Corporation has signed comprehensive restructuring agreements with Vietnam Airlines covering the leasing of 18 aircraft, including 12 Airbus A321neo and six Boeing 787-10 aircraft. These agreements extend terms and revise lease economics closely tailored to the recovering economies and air travel in Vietnam and Southeast Asia.” It added: “ALC does not comment or disclose specific amounts on transactions with any of our lessees.”