China has instructed Chinese carriers to refuse delivery of Boeing jets and directed existing customers to stop purchasing aircraft-related equipment and parts from US companies, another sign of the escalating trade war between the USA and China that directly impacts aviation and global travel.

China Tells Chinese Carriers To Stop Boeing Deliveries

In the last month, we’ve seen the US impose duties of up to 145% on imports from China with China responding by imposing duties of up to 125%. Fierce barbs have been exchanged by both sides, with the US declaring that China has been taking advantage of the US for too long and China declaring that the US is bullying it.

Now aerospace giant Boeing finds itself caught in the fray, with reports emerging that China has instructed Chinese carriers to:

• refuse delivery of Boeing aircraft
• stop purchasing aircraft parts and equipment from US suppliers

Beijing is reportedly also looking into providing assistance to airlines that are leasing Boeing jets and now facing higher costs.

In the coming days, 10 Boeing 737 Max were slated for delivery in China, including for Air China, China Southern Airlines, and Xiamen Airlines. The status of those orders appears in jeopardy.

To be clear, this news is based on a Bloomberg report: neither the Civil Aviation Administration of China or Boeing has officially confirmed whether this policy is in effect.

Who Will Blink First?

I always imagined the final deterioration in relations between China and the USA would come when China invaded Taiwan. There’s no doubt that China has intently studied the response of Western powers to Russia’s invasion of Ukraine in order to best gauge how it can attack Tawaian, a nation China claims for itself.

The rapid deterioration in relations between Washington and Beijing over trade likely accelerates that timeline, though I still maintain some hope that both sides can avoid a further escalation that only weakens all parties.

President Trump already blinked by amending the blanket tariffs to exclude smartphones, computers, and other consumer electronics, even as he since promised a fresh look at duties on these devices.

In 1922, British philosopher Bertrand Russell published The Problem of China, writing:

“The Chinese nation is the most patient in the world; it thinks of centuries as other nations think of decades. It is essentially indestructible and can afford to wait.”

The US thinks China depends on it for economic booming prosperity: to feed its population and grow the middle class. Who will prevail? Will trade with the rest of the world insulate China from its US trade war?

It’s too early to tell, but we certainly see who will lose, and that is Boeing.

But in one sense, Boeing has already lost. In 2018, about 25% of Boeing’s new aircraft deliveries went to China. But as relations between Washington and Beijing deteriorated during Trump’s first term, carriers began to shift more business to Airbus. Indeed, Boeing has not announced a major Chinese order in many years. This was only exacerbated after the Boeing 737 MAX debacle, with China among the first nations to ban that jet type from delivery.

CONCLUSION

Reports out of China suggest the Chinese government has banned imports of Boeing jets and also instructed existing Boeing customers to stop by replacement parts from US supply sources. This merely continues a trend of China away from Boeing that began in 2019.

China cannot ramp up Comac C919, built on stolen Western technology, or other domestic aircraft production overnight, making Airbus the biggest beneficiary of this news.

image: Boeing