14:15 | 14/01/2019 Investment
(VEN) - Vietnam Economic News’ Nguyen Huong spoke with Gael Meheust, President and Chief Executive Officer of CFM International - the world’s leading manufacturer of jet engines for single-aisle aircrafts.
What do you think about the Vietnamese aviation market?
According to a report compiled by the International Air Transport Association (IATA), Vietnam will have about 250 million air traffic users by 2030, three times higher than in 2017. This is one of the strategic potential markets that CFM targets.
We are attracted by Vietnam’s business models. For example, Vietjet Air has increasingly attracted more and more passengers due to its fare policy. The number of aircraft has also increased, which makes us feel very optimistic about doing business with Vietjet.
Vietnamese airlines are growing rapidly with clear plans and strategies, so we have many advantages in developing the market in Vietnam. We have a very good partnership with Vietjet Air and hope to build the same relationship with Bamboo Airways. CFM successfully negotiated a number of deals with Bamboo Airways.
CFM spent US$1 billion to upgrade and expand its manufacturing plants. Among them, which factories are located in Vietnam? Are there any opportunities for Vietnamese businesses to supply spare parts for CFM?
CFM currently has no factories in Vietnam. However, with rapid growth and strong investment in infrastructure for the aviation sector, we are very optimistic about this market. I think there will be a factory in Vietnam in the future.
We are always ready to cooperate with Vietnamese suppliers if they can guarantee product quality and prices.
Why have Vietnamese suppliers not participated in the CFM supply chain?
We have been working with a number of close and long-standing partners. Adding a new supplier would mean that another supplier would have to leave.
However, this does not mean that we will not have new production units. When there are new plans, we will still send information to suppliers and future cooperation is possible.
Competition in the aviation sector is very fierce. What are CFM’s strategies to make a difference compared to its rivals?
We are committed to bringing great benefits to our customers, from purchasing and fuel costs to performance and warranty. Currently, our engines have an average utilization rate of 96 percent per year, meaning that they are capable of flying 350 days a year, 15-20 percent more than those of other manufacturers can fly. Boeing, especially the 737 MAX, has mostly used our engines.
Regarding Airbus, when buying or renting aircraft airlines have the right to choose their engines, so competition is very fierce. However, with such Airbus models, our market share is more than half, reaching about 58 percent.