China Lifts Ban on Boeing after Tariff Truce with US

DALLAS — China will temporarily allow Boeing aircraft deliveries after a trade deal with the US is finalized. This is good news for Boeing as China will represent 20% of its global demand.

Bloomberg reports that after weekend trade talks in Geneva between the US and China, Beijing officials began informing domestic carriers and government agencies that deliveries of American-made aircraft could resume. 

The agency also said that Chinese airlines are allowed to organize deliveries according to their own schedule and terms.

No comment has yet come from Boeing or the China Civil Aviation Administration.

The ban was lifted after a truce in the escalating trade war between the two nations, which was initiated by the sharp increases in tariffs by the Trump administration.

New Terms

According to Bloomberg, the US will “reduce aggregate duties on most Chinese imports from 145% to 30% for 90 days.” In response, China will reduce tariffs on American goods from 125% to 10%. It will also lift some of the additional countermeasures introduced on April 2.

The tariff war shut Boeing out of the Chinese carrier market, and Beijing ordered airlines to stop taking deliveries of the company's aircraft.

During the first-quarter earnings call, Boeing executives said the company planned to deliver 50 jets to Chinese carriers this year, with 41 in production or pre-built.

Last month, at least three jets at Boeing's delivery center in China were returned to the US.

As the tariff pause will last only for 90 days, Boeing has said it may soon look for alternative buyers for aircraft built for China that have not yet been delivered. 

The prospect of new 737 Max aircraft being available has sparked open interest from India to Malaysia and Saudi Arabia, as airlines look for ways to take advantage of the situation.