China Hits Back at US Trade War
China has retaliated against the US by halting Boeing aircraft deliveries and banning purchases of US-made aviation components. This move comes amid a massive 125% tariff on American imports, effectively pushing Boeing jets out of the Chinese market.
Impact on Boeing
- Loss of key growth market: China was expected to need over 8,800 new aircraft in the next 20 years.
- Grounded aircraft: 10 brand-new 737 MAX jets have no buyers.
- Revenue crunch: Boeing faces delayed payments due to stalled deliveries.
Market Consequences
- Boeing stock slumps: Down 3% premarket, extending a 10% YTD decline.
- Competitive disadvantage: Airbus may gain an upper hand if China favors European jets.
Escalating Tensions
- Geopolitical blowback: The White House has condemned China's move as a "clear violation" of past agreements.
- Economic warfare: The trade war is intensifying, with potential ripple effects on supply chains, US manufacturing, and global aviation.
