China orders airlines to suspend Boeing jet deliveries amid trade war

BEIJING: China has ordered its airlines not to take any further deliveries of Boeing jets in response to the US decision to impose 145% tariffs on Chinese goods, Bloomberg News reported on Tuesday, citing people familiar with the matter.

Shares of Boeing — which looks at China as one of its biggest growth markets and where rival Airbus holds a dominant position — were down 2% in early trading.

The global aerospace industry is in the middle of a full-blown tariff war, with planemakers, airlines and suppliers reviewing contracts worth billions of dollars, after US supplier Howmet Aerospace ignited an debate over who should bear the cost of the tariffs.

China’s top three airlines - Air China, China Eastern Airlines and China Southern Airlines - had planned to take delivery of 45, 53 and 81 Boeing planes, respectively, between 2025 and 2027.

Beijing has also asked that Chinese carriers halt purchases of aircraft-related equipment and parts from US companies, the Bloomberg report said.

China’s move to halt purchases of aircraft-related components is expected to raise maintenance costs for the jets flying in the country.

The Chinese government is also considering ways to provide assistance to airlines that lease Boeing jets and are facing higher costs, Bloomberg News reported.