China Ends Boeing Delivery Ban After US Trade Breakthrough

China has lifted a month-long ban on the delivery of Boeing Co. aircraft to its airlines, as reported by sources familiar with the situation. This decision comes in the wake of a breakthrough in trade negotiations between the US and China, which has led to a temporary reduction of tariffs on both sides.

Officials in Beijing have begun notifying domestic airlines and government agencies this week that they can resume taking delivery of US-made planes. Sources indicate that airlines now have the discretion to arrange deliveries according to their own schedules and terms.

The resumption of deliveries is expected to provide an immediate boost to Boeing, coinciding with a tariff truce between the world’s two largest economies. The US has reduced its combined 145% tariffs on most Chinese imports to 30% for a period of 90 days, while China has lowered its 125% duties on US goods to 10% and has removed several countermeasures implemented since April 2. However, the revival of jet deliveries may be short-lived if the ongoing tariff dispute is not resolved within this three-month window.

Boeing found itself in a difficult position amid the trade tensions, especially after President Donald Trump imposed tariffs on major trading partners, prompting retaliatory duties from China. This situation led to Chinese airlines being unable to take delivery of Boeing jets.

Signs of potential reconciliation appeared in late April when China expressed willingness to support normal cooperation with US companies, even offering to suspend higher duties on certain US imports, including medical equipment, industrial chemicals, and aircraft leases.

While the lifting of the ban allows deliveries to restart, it remains uncertain how quickly Chinese carriers will be able to receive the aircraft they require. A Boeing spokesperson declined to comment, and the Civil Aviation Administration of China did not immediately respond to requests for comment.

Some jets had already been returned to the US after being declined by Chinese customers. Boeing had also indicated its readiness to find alternative buyers for aircraft destined for China that had not yet been delivered. The availability of new 737 Max jets has attracted interest from airlines in countries such as India, Malaysia, and Saudi Arabia.

In 2019, China became the first country to ground the 737 Max following two fatal crashes. Trade disputes during both the Trump and Biden administrations have led to a shift in Chinese orders towards Europe’s Airbus SE. Additionally, in January 2024, Boeing faced a quality crisis when a door plug failed mid-flight.

The political significance of Boeing’s role in trade is growing. Recently, the White House announced a trade agreement with the UK that includes a $10 billion deal for Boeing, involving the sale of 32 787-10 Dreamliners to British Airways.