China Freezes Boeing Deliveries as US Imposes Tariffs

China announced the halt of the deliveries of Boeing airplanes amid rising tensions between the two economic giants, China and the USA. Recently, Donald Trump levied massive tariffs of 145% on Chinese goods. In retaliation, the Chinese imposed tariffs of 125% on US goods, which more than doubled the cost of Boeing Jet Airways.

Moreover, the Bloomberg reported that the China is looking for alternatives to aid its airline industry, amid these tensions. However, Boeing might end up losing more, in the tariff war. 

China is projected to make up 20% of global aircraft demand over the next two decades. According to a Bloomberg report, nearly 25% of Boeing’s aircraft deliveries in 2018 went to China. However, in recent years, Boeing hasn’t reported any significant new orders from China, largely due to trade tensions and internal challenges.

The Silver Lining

Indian carriers, currently facing challenges in acquiring aircraft due to global supply chain constraints, may find relief as China has instructed its airlines to avoid purchasing Boeing aircraft.

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According to Airline Industry specialist, “We anticipate some of these aircraft, originally destined for Chinese carriers, will be redirected to Indian customers. The previous year or two witnessed a similar occurrence, with white tails (aircraft manufactured for specific customers but acquired by others) being allocated to AI Express and Akasa.”