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China reportedly asked its airlines to halt Boeing orders, which has put the aircraft manufacturer in the middle of the U.S.’s trade war with China. Boeing, a major U.S. company, relies heavily on international orders, and CEO Kelly Ortberg has advocated for continued free trade.
China’s ban on Boeing deliveries amid an ongoing tariff battle with the U.S. has thrust the American aircraft manufacturer into the middle of the trade war.
China ordered its carriers to stop all aircraft orders from Boeing, Bloomberg reported Tuesday, citing anonymous sources familiar with the matter. It’s the latest move in a trade war stemming from Trump’s up to 145% tax on goods from China. Beijing has also reportedly told Chinese airlines to no longer purchase airplane parts or equipment from U.S. firms.
The ban on U.S.-made jets and aircraft equipment comes after China announced a 125% retaliatory tariff on American products last weekend, leading airlines to reconsider growing their fleets to avoid paying for the rising cost of imported aircraft parts and jets. Ryanair CEO Michael O’Leary told the Financial Times he would consider delaying deliveries of Boeing jets should the tariffs continue.
According to Bank of America aerospace and defense analyst Ronald Epstein, Boeing’s role in China’s retaliation strategy has forced Trump to pay attention to the American aircraft manufacturer, even as the situation is subject to change or reverse.
“Boeing is the U.S.'s largest exporter, as such, we are not surprised by China's move; however, we do see this as unsustainable,” Epstein wrote in a note to investors Tuesday. “When considering balances of trade, we think the Trump Administration can't ignore Boeing.”
Boeing remains one of the few old-school U.S. manufacturers and relies heavily on exports, receiving about two-thirds of its orders outside the U.S. CEO Kelly Ortberg has opposed tariffs, citing the importance of Boeing’s international business on providing U.S. jobs.
“Free trade is very important to us,” Ortberg said at a Senate hearing earlier this month. “We really are the ideal kind of an export company where we’re outselling internationally. It’s creating U.S. jobs, long-term high-value U.S. jobs. So it’s important that we continue to have access to that market and that we don’t get in a situation where certain markets become closed to us.”
Boeing weathered a disastrous year as it navigated the fallout of multiple safety incidents and a seven-week strike that halted the production of its foundational 737 jets. Following Bloomberg’s report, Boeing’s shares fell as much as 4.6% in premarket trading Tuesday.