Boeing supplier KP Aero to invest $20 million in factory in Vietnam

HANOI (Reuters) - South Korea's aviation industry supplier KP Aero, which makes parts for Boeing planes, is set to invest $20 million in a factory in central Vietnam, local authorities said, in a move that could expand Boeing's supply network in the country.

The U.S. aviation giant has said it is willing to expand its manufacturing network in Vietnam, where it already has seven "sub-tier" suppliers - companies that sell components to its direct suppliers.

In September, Boeing also reached a preliminary deal with flag carrier Vietnam Airlines for the sale of 50 Boeing 737 Max 8 jets.

KP Aero will be formally granted later this week the authorisation to invest $20 million in Vietnam, authorities in the central city of Danang said in media statement on Wednesday.

A Vietnamese official said the investment will be in the city's high-tech industrial park.

KP Aero did not respond to a request for comment.

KP Aero is a supplier of parts to Korean Air's engineering division, which is in turn a direct supplier to Boeing.

Boeing declined to comment.

(Reporting by Francesco Guarascio; editing by Miral Fahmy)