China halts Boeing deliveries as trade war intensifies
China has instructed its airlines to stop taking deliveries from Boeing, in the latest twist in the country’s fast-moving trade war with the US.
Sources familiar with the matter told Bloomberg that officials had also requested Chinese carriers halt purchases of any aircraft-related equipment and parts from US companies.
Donald Trump has imposed tariffs as high as 145 per cent on Chinese goods in a bid to bring down the US’s near $300bn (£226.8bn) trade deficit with China. Beijing has retaliated by hiking its own tariffs on goods imported to America.
The move comes as a blow for Boeing, which is looking to claw back ground on rival Airbus after a torrid 2024 that saw it grapple with a major safety crisis and a multi-billion pound hit from machinist strikes.
China’s aviation market is projected to become the largest globally by 2043, surpassing North America and Europe to a value of around $61bn (£46.1bn).
Around 10 Boeing 737 Max aircraft are scheduled to enter China’s aircraft fleet, according to data from Aviation Flights Group reported by Bloomberg.
It comes as the chief executive of Ryanair, Boeing’s biggest customer, warned on Tuesday the Irish airline could delay deliveries if tariffs are imposed on Boeing aircraft.
Michael O’Leary said there would be a “significant debate” over whether manufacturers or airlines should shoulder the cost of tariffs.
“The airlines will say the manufacturer must pay. I’m sure the manufacturer will insist the airline pays,” he told the Financial Times.
Boeing shares are down around seven per cent this year to date.
Danni Hewson, head of financial analysis at AJ Bell said: “If beleaguered Boeing needed a bit more bad news to really cement its recent woes, it seems to have got it today.
“Shares in the aircraft giant dropped on what’s been an otherwise steady day for US markets after reports that China has told its airlines not to take delivery of any new planes from the US manufacturer as the trade war between the two countries ramps up.
“Rival Airbus, which could potentially benefit from a prolonged spat between the economic giants, saw its shares rise slightly in response, but the lack of big swings in share price suggests investors aren’t taking anything for granted and assuming what’s making newsprint today may only be fit to wrap a chippy tea tomorrow.”