The escalating tariff tensions between China and the United States have reached the aviation industry, following Tuesday's announcement that the Asian giant has instructed its airlines not to accept any more deliveries of Boeing aircraft.
The decision directly impacts the major airlines in the country, such as Air China, China Eastern, and China Southern, which had scheduled the reception of 179 Boeing aircraft between 2025 and 2027, according to the agency Bloomberg, citing informed sources on this matter.
This instruction comes after the announcement by United States President Donald Trump to impose tariffs of up to 145% on Chinese products, to which Beijing responded with a 125% tariff on American goods. Together, these measures represent a new episode of tit-for-tat retaliation between the two powers, placing the aerospace sector at the center of the conflict.
Although the entry of some already paid aircraft with completed documentation before the tariff implementation will be allowed, future deliveries are on hold.
Although Boeing faces a significant blow, as China accounts for about 20% of the projected global demand for aircraft, analysts consulted by the agency Reuters indicated that the short-term suspension would not have a devastating impact.
However, Boeing's shares fell by nearly 3% following the announcement of the decision, while a potential cut of up to $1.2 billion in its cash flow for 2025 is anticipated.
Furthermore, although the Beijing order mentions restrictions on American parts, two sources from the aerospace sector consulted by Reuters stated that they have not received an official or independent notification regarding a widespread ban on the import of components. This raises doubts about the actual scope of the measure.
The president Trump, from his social media platform Truth Social, reacted with annoyance to the announcement. “Interestingly, they just breached the major agreement with Boeing, saying that they 'would not take possession' of the planes they had fully committed to.”
In this regard, experts agree that it would be difficult for China to completely halt the acquisition of American components without seriously impacting its own industry.
This includes the C919 model, manufactured by the Chinese consortium COMAC, whose assembly and operation rely heavily on American technology and parts.
“If China stops buying aircraft components from the United States, the C919 program will be halted or will die”, warned the analyst from Bank of America, Ron Epstein, in a note sent to his clients.
In light of the new scenario, the Chinese government is assessing financial support mechanisms for the affected airlines, particularly those operating Boeing fleets under leasing agreements. These companies will have to contend with rising maintenance and renewal costs due to the potential shortage of parts and technical support.
Meanwhile, the measure could open a window of opportunity for Airbus, although the limited production capacity of the European consortium and China's reliance on Western technology make an immediate replacement challenging.
Frequently Asked Questions about the Suspension of Boeing Aircraft Deliveries in China
Why has China decided to suspend deliveries of Boeing airplanes?
China has decided to suspend Boeing aircraft deliveries due to the rising tariff tensions with the United States. The measure is a retaliation against the 145% tariffs imposed by the Trump administration on Chinese products, which has escalated the trade war between the two nations and has placed the aerospace sector at the heart of the conflict.
What impact will this decision have on Boeing?
The decision by China will significantly impact Boeing, as the Asian country represents about 20% of global aircraft demand. Boeing's shares have fallen nearly 3% following the announcement, and a potential cut of up to $1.2 billion in the company's cash flow is anticipated for 2025.
How could this measure affect the aerospace industry in China?
The suspension of deliveries from Boeing could complicate the situation for the Chinese aerospace industry, which relies heavily on American technology and parts. The assembly of COMAC's C919 model could be impacted if the supply of components from the United States is disrupted, potentially halting or even ending the program.
Can Airbus benefit from Boeing's delivery suspension in China?
Although it may seem that Airbus would benefit from Boeing's suspension of deliveries in China, the immediate replacement is not straightforward. Airbus's limited production capacity and its reliance on Western technology complicate the situation. However, this measure could open a long-term opportunity for the European consortium.
What measures is the Chinese government considering to support its airlines?
In light of the current situation, the Chinese government is assessing financial support mechanisms for the affected airlines, particularly those operating Boeing fleets under leasing agreements. This is crucial to address the rising costs of maintenance and renewal in the face of potential shortages of parts and technical support.
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