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Boeing (NYSE:BA) shares fell more than 3% in early Tuesday trading after reports surfaced that China instructed its domestic airlines to suspend further deliveries of the company's aircraft, intensifying trade hostilities between Beijing and Washington.
The reported order follows U.S. tariff hikes of up to 145% on a range of Chinese imports under President Donald Trump's administration, which have further strained economic ties between the two countries.
In addition to blocking aircraft deliveries, China is said to have told carriers to pause purchases of aviation parts and equipment from U.S. suppliers, according to Bloomberg, citing sources familiar with the matter.
Beijing is also reportedly weighing support measures for Chinese airlines that lease Boeing jets and now face higher costs due to the widening trade rift.
The developments mark a significant setback for Boeing's commercial business in one of its most critical overseas markets, and come as the company continues navigating a turbulent period involving supply disruptions and safety scrutiny.
According to the Tuesday report, no specific timeline has been given for when or if deliveries might resume. Boeing has not yet issued a public statement on the matter.
This article first appeared on GuruFocus.