Boeing executives are striking a confident tone despite a trade war they now confirm has prompted Chinese customers to refuse to accept new aircraft.
The US company’s leaders say they will find new homes for jets that had been earmarked for Chinese buyers, while predicting that tariffs will not significantly drive up costs nor hinder plans to ramp aircraft production.
“Due to the tariffs, many of our customers in China have indicated they will not take delivery,” Boeing chief executive Kelly Ortberg said during the company’s first-quarter earnings call on 23 April. “I feel really good about our overall plan for the year even though I expect the China situation will take away some of the headwind we’ve built.”
“We don’t see any change in the overall demand… Everybody wants the aircraft,” he adds.
Boeing’s stock price jumped following the comments.
Aircraft-tracking websites show that several 737 Max destined for Chinese airlines were recently flown back to Seattle from Zhoushan in China, where Boeing operates a 737 deliver centre.
Boeing had not, until 23 April, confirmed that Chinese buyers were rejecting deliveries.
“The only region that we have an issue with aircraft delivery today is China,” says Ortberg.
US President Donald Trump this month slapped steep tariffs on China, prompting an escalation that left the USA charging 145% on some Chinese imports and China taxing US imports at 125%.
The US also imposed, then paused for 90 days, country-specific tariffs on some 60 nations, a 10% tariff on imports from all other nations and a separate steel and aluminium tariff. Exceptions exist for some aerospace products moving between Canada, Mexico and the USA.
Aerospace insiders fear the taxes will imperil an industry dependent on tariff-free trade, while noting that the USA is a net exporter of aerospace goods.
Boeing has “been spending a lot of time making sure the [Trump] administration understands the implications”, Ortberg says. “They understand. They know this is extremely important to the trade balance.”
Such efforts may be paying off. The Wall Street Journal reported on 23 April that the White House is considering slashing some tariffs against China.
Regardless, Boeing executives describe the possible impact on their business in 2025 as minimal.
“The net annual impact of higher tariffs on our input costs is manageable and within our plan,” says Boeing chief financial officer Brian West. “It’s less than $500 million annually.”
Ortberg says about 80% of Boeing’s supply chain spending is with US companies, meaning minimal exposure.
Boeing is paying 10% tariffs on products – primarily widebody aircraft structures – sourced from Japanese and Italian suppliers. But Ortberg says Boeing “should recover” the portion of that expense attributed to finished aircraft that it sells to non-US buyers through a refund called a “duty drawback”.
Boeing exports about 70% of its commercial jets.
The company had expected for the rest of 2025 to deliver about 50 commercial aircraft to Chinese customers, including nine not-yet-produced jets and 41 either completed or in production, executives say.
“We’re actively assessing options for remarketing already built or in-process airplanes,” says Ortberg. “For the nine airplanes not yet in the production system, we’re engaged with our customers to understand their intentions for taking delivery, and if necessary, we have the ability to assign those positions to other customers.”
“We have many customers who want near-term deliveries,” he adds.
Some aerospace analysts have said they think Boeing will have no trouble finding new buyers, citing strong demand, including from Indian airlines.
Additionally, CFO West says “the strong market backdrop across the rest of the world still supports our planned production rate increases”.
Boeing is producing about 30 737s monthly and aims within the next few months to hit 38 monthly – the maximum allowed by the Federal Aviation Administration.
After that, it intends to ask the FAA to approve a production jump to 42 737s monthly before accelerating to rate 47 and then to rate 52, West said.
Boeing also intends to increase 787 production from five to seven jets monthly this year.
