China has instructed its airlines to cease taking further deliveries of Boeing aircraft in reaction to the recent decision by the U.S. to impose tariffs of 145% on Chinese imports, as reported by Bloomberg News on Tuesday, citing sources familiar with the situation.
The announcement led to a 3% decline in Boeing’s shares during premarket trading, as the company views the Chinese market as a crucial growth area, where its main competitor, Airbus, currently holds a significant advantage.
Furthermore, Beijing has urged Chinese airlines to stop purchasing U.S. aircraft-related equipment and components, according to the Bloomberg report. This directive to suspend acquisitions of necessary aviation parts is expected to increase maintenance expenses for the aircraft already operating within China. The tariff confrontation stems from actions taken by U.S. President Donald Trump as part of his trade policies.
Recently, China escalated its tariffs on U.S. imports to 125% in retaliation for the imposed U.S. tariffs. The Chinese government is also exploring options to support airlines leasing Boeing jets, which are now confronted with increased expenses because of this situation.
Boeing has yet to issue a response to inquiries from reporters about the matter. The substantial 125% tariff significantly raises the financial burden of acquiring Boeing jets for Chinese airlines, potentially leading them to explore alternatives such as Airbus or domestic manufacturer COMAC.
The three leading airlines in China—Air China, China Eastern Airlines, and China Southern Airlines—have outlined plans to receive 45, 53, and 81 Boeing planes, respectively, between 2025 and 2027.
As tensions escalate with these tit-for-tat tariffs between the world’s two largest economies, analysts warn that this situation could bring trade to a standstill, with the value of trade between the U.S. and China estimated at over $650 billion in 2024.
Trump expressed confidence in the tariffs placed on China and suggested that a potential agreement with Beijing might be on the horizon; however, no definitive arrangement has been established as of now.