The largest US exporter, Boeing has been caught in the crossfire after President Donald Trump imposed new tariffs of up to 145 percent on many Chinese products, sparking retaliatory 125 percent levies from Beijing.
On Tuesday, Trump accused China of reneging on a “big Boeing deal,“ following a Bloomberg news report that Beijing ordered airlines not to take further deliveries of the company’s jets.
Boeing has declined to comment on the matter.
‘Not surprised’
But as some buyers prefer to remain anonymous, the true figure could be higher.
“China represents about 20 percent of the market for large civil jets over the next 20 years,“ BofA Securities said in a note.
“Boeing is the US’s largest exporter, as such, we are not surprised by China’s move; however, we do see this as unsustainable,“ BofA Securities said.
The Commercial Aircraft Corporation of China (COMAC) is also “highly dependent on US suppliers,“ the analysts said.
A delivery blockage would affect the United States’ trade balance further as well.
According to US official data, commercial aircraft exports reached $4.2 billion in August last year but dropped to $2.6 billion in September. They slipped further in October and November.
Airline customers
A delivery freeze would have direct consequences for the group, which traditionally receives 60 percent of the price upon delivery.
Besides concerns surrounding Beijing, Boeing will likely be squeezed by higher duties too.
Ryanair, a major Boeing customer, notably placed an order in May 2023 for 300 737 MAX 10s, including 150 firm orders, for a list price estimated at over $40 billion.
Ed Bastian, CEO of Delta Air Lines, said last week that he does not intend to pay customs duties on the Airbus aircraft he expects this year.
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