Sky-high US tariffs to hit Boeing, Chinese airliners and China’s home-grown jets
As the trade war fallout continues to spread, full domestic sourcing of parts for China-made planes ‘is unlikely to happen before 2035’, analyst says
In the midst of trade upheaval, Boeing’s customers in China have “indicated that they will not take delivery” on up to 50 planes that were earmarked for the Chinese market this year, according to the US aerospace giant’s CEO.
And the situation in China “will take away some of the headroom we’ve built with our strong first-quarter deliveries”, Kelly Ortberg said during Boeing’s latest earnings call.
The executive’s acknowledgement this week of trouble in China shows that the heightened trade war between the two great powers will accelerate Boeing’s steep decline in the Chinese market after years of struggle, according to analysts.
They also said that the US-China tariff tiff would simultaneously burden China’s home-grown aircraft maker.
With China’s retaliatory tariffs on American imports considered cost-prohibitive, Chinese airlines would pay unprecedented prices for Boeing planes shipped from the US.
And Chinese airliners will face higher maintenance costs for their Boeing fleets in service, the analysts added.