Sections

ideals
Business Essentials for Professionals

China Could Give Major Order After Any U.S.-China Trade Deal: Boeing CEO


08/28/2019


China Could Give Major Order After Any U.S.-China Trade Deal: Boeing CEO
Any deal that would bring to end the year long trade war between the United States and China would result in an aircraft order for Boeing.
 
In an interview to the news agency Reuters, the company’s Chief Executive Dennis Muilenburg however also cautioned that it was “tough to predict” when a possible trade deal between the two largest economies of the world could happen which could bring an end to the prolonged trade war.
 
“It’s been challenging,” Muilenburg said. “But I think ultimately they will find a solution because of the mutual interest, and we think our airplane business will be part of that ultimate solution.”
 
“We are hopeful that if there is a trade solution, it will be beneficial to airplane orders as well,” he added, saying a healthy aerospace industry benefits both countries.
 
Last year, the Chicago-based Boeing had delivered one every four jets that were delivered to airlines in China and therefore company calls itself the largest exporter of the United States. The company has forecast there would be demand for about 7,700 new airplanes in China during the next 20 years which would have a total value of $1.2 trillion.
 
However, Beijing has been forced to walk a geopolitical tightrope for more than a year because of the tit-for-tat tariffs between the United States and China which has slowed down the global economy. It is predicted that China would become the largest aviation market in the world overtaking the US in the next decade.
 
In recent years, China has become a focal market for Boeing in its market share war in Asia with its European rival Airbus and as such the American plane market has been expanding its operations in the Chinese market. However the company executives have also drawn up plans of not getting embroiled in the trade war and get into a tiff with the US President Donald Trump who has been stressing repeatedly on protection of American jobs and intellectual property and technology.
 
The wavering economy of China has forced its airlines to go slow in procuring aircraft from both Boeing and Europe’s Airbus SE, say analysts. The airlines of the country have also therefore postponed major purchasing decisions until the outcome of the trade negotiations with the United States are clear.
 
“It’s hard to predict whether or not a successful deal will be achieved,” Muilenburg said. “China’s been not ordering airplanes over the last year, year and a half. That pent-up demand signal is still there. The airplane need is real.”
 
The comments by Muilenburg came close on the heels of the comment by the foreign ministry of China that it hopes appropriate environment for trade negotiations would be made by Washington. China also rubbished claims made by Trump at the G7 summit in France that senior Chinese official shad called US officials during the weekend to talk on trade. The possibility of a trade deal with China was predicted by Trump on Monday and said that he had managed to increasing economic pressure on China which has led to job losses here.
 
“We’ve been advocates for finding a balanced solution,” Muilenburg said. “We are going to continue to do that.”
 
(Source:www.reuters.com)