China has ordered its domestic airlines to halt deliveries and purchases of Boeing jets and aircraft parts from the US, according to reports from Bloomberg News.
This move is seen as a retaliatory measure against the US tariffs imposed on Chinese goods, which have reached as high as 145 percent .
The Chinese government has also directed airlines to suspend purchases of aircraft-related equipment and components from American companies.
The decision is expected to significantly increase maintenance costs for jets operating within the country and may impact the operational efficiency and safety standards of the affected aircraft fleets.
Boeing’s stock dropped 3 percent in premarket trading after the news broke, as the company faces significant challenges in China, a market projected to account for 20 percent of global aircraft demand over the next two decades.
Major Chinese carriers like Air China, China Eastern, and China Southern have plans to take delivery of 45, 53, and 81 Boeing planes, respectively, between 2025-2027.
Some deliveries with paperwork completed before the tariffs were imposed might proceed on a case-by-case basis.
Airlines may explore alternatives like Airbus, which holds a stronger foothold in China, or the domestic manufacturer COMAC.
COMAC’s C-919 passenger aeroplane has been ordered and/or received by several major Chinese airlines, including China Eastern, Air China, and China Southern Airlines.
The escalating reciprocal tariffs between the world’s two largest economies threaten to bring goods trade to a complete halt.
In 2024, this trade was valued at over $650 billion.
China has hiked levies on US imports by 125 percent in retaliation against US tariffs.
President Donald Trump has suggested a possible deal amid mounting economic tensions, but no agreement has been reached yet.
Ryanair’s Group CEO, Michael O’Leary, has signalled that his airline may postpone incoming Boeing aircraft deliveries if trade tensions continue to inflate costs.
Airbus CEO Guillaume Faury told shareholders that the company is closely monitoring the shifting tariff landscape, experiencing delivery issues from US supplier Spirit AeroSystems.
The halt in Boeing deliveries and parts purchases will likely complicate upkeep and repairs, forcing airlines to seek alternative sources or face higher expenses.
Boeing’s market value has declined by 7 percent since the beginning of the year, with investors concerned about the broader impact of tariffs.
The situation remains fluid, with ongoing trade negotiations and potential implications for the aviation industry.
