China Instructs its Airlines to Halt Boeing Deliveries Amid Tariff War
Things are not looking good for Boeing.
An Air China Boeing 777-300ER in Frankfurt (FRA).
Trade War Hitting Aviation Giant Boeing
As the global trade war conducted by the United States continues, Bloomberg reports that in response to the American decision to impose 145% tariffs on Chinese goods, China instructed its airlines from all over the country to stop receiving Boeing jet deliveries.
This is a tricky situation because airlines like Air China, China Eastern, and China Southern all have Boeing aircraft, most notably the 777, and the Government also requested its companies to exclude American aircraft-related products, equipment, and parts. This all means that it will be more difficult for these airlines to maintain their Boeing fleet. Thankfully for them, the Chinese government is considering financial assistance to help support the airlines affected by this measure.
Yet Boeing just restarted delivering 737 MAXs to Chinese airlines back in June 2024, so it seems like the program just can’t catch a break, even though it was somewhat successful in that region of the world. As an example, China Southern currently has a fleet of 34 737 MAX and was awaiting 8 more, plans which are now to be scrapped. Fortunately, most Chinese airlines have extremely diverse fleets and include both Airbus and Boeing aircraft. However, airlines like Hainan Airlines who have a hundred 737s and a few A320s will face more challenging times.
China Southern has 201 Boeing 737s including 34 MAX aircrafts. (Picture: Windmemories)
Excellent News for Comac?
While Boeing slowly but surely withdraws from Chinese skies, Chinese aerospace company Comac will most certainly take its place as Airbus’ rival in the Red Dragon country. Their newest aircraft; the C919, a competitor of the 737, will no doubts win more orders with Boeing gone. The C919 currently has 713 orders in total and reaching a milestone of 1000 orders could be achieved by attracting current Boeing customers like Hainan Airlines, Xiamen Air and Shanghai Airlines. The opposite direction stays plausible, according to Reuters, a credible source claims that if China stops buying American components, the Comac program would not be able to survive... To be continued…
China Eastern is among current operators of the Comac C919. The airline has a fleet of 10 of them. (Picture: airinsight)
What About Cathay Pacific?
It seems unclear if Cathay Pacific’s order of 777X will be affected by this new measure, considering the Hong Kong Special Administration Region has a different status in accordance with the “one country, two systems” policy of the government. That Boeing order was already pushed to 2027 so it is likely that the tariff war will be the straw that breaks the camel’s back. Regardless of what it means, It is still logical to assume Cathay Pacific will still align itself with Chinese airlines in their exodus from Boeing.
Another Winner: Airbus
Airbus is most probably the winner of this whole situation, Cathay Pacific might indeed have to turn to the Airbus A350-1000 as an alternative to the 777X as Chinese airlines are discouraged from keeping Boeings in their fleets and forbidden to order any. The recent rumors that Cathay was going to order 787s are probably to be forgotten. I can also see Hainan Airlines and China Southern switching to the Airbus A330neo to replace the 787s.
It is likely that the A330neo program gets new orders from the region.
Conclusion
Ultimately, the biggest loser here is Boeing, which was already facing 777X and 737MAX delays and incidents. There just doesn’t seem to be a way out for Boeing here, and it’s just unfortunate that their losses will be caused by the actions of their own U.S. government. Although I can imagine the American corporation pressuring the US government, any change in foreign affairs will have to come from the administration in place.
