In a recent announcement, U.S. President Donald Trump revealed that China has committed to purchasing 200 aircraft from Boeing, a figure that fell short of the expectations set by industry analysts. This news, shared during an interview with Fox News Channel, led to a 4.1% drop in Boeing’s stock value. While specifics of the deal, such as the delivery schedule and types of jets, remain undisclosed, the number is significantly less than the 500-plane deal that was reportedly under negotiation prior to a meeting between Trump and Chinese President Xi Jinping.
During the Fox News interview, Trump highlighted the agreement, stating, “One thing he agreed to today, he’s going to order 200 jets… 200 big ones,” in reference to President Xi. This Boeing order was anticipated to be one of several business arrangements resulting from the much-anticipated summit. The meeting was also expected to extend a delicate trade truce established in the previous October, which saw Trump halting hefty tariffs on Chinese imports and China easing its grip on global rare earth supplies.
Sources familiar with the negotiations indicated that discussions had centered around a potential order of 500 Boeing 737 MAX jets, with the possibility of additional orders for more costly widebody aircraft following the summit. Simultaneously, China has been in similar negotiations with Airbus, Boeing’s European rival, to secure a comparable deal. Both aerospace giants are in fierce competition for market share in China, the world’s second-largest aviation market, where Airbus has gained a significant foothold, even establishing an A320 assembly line in Tianjin.
China is anticipated to require as many as 1,000 new aircraft to meet the surging demand for air travel, with projections from Boeing and Airbus estimating the need for at least 9,000 new jetliners by 2045. The last major order China placed with Boeing occurred during Trump’s visit to Beijing in November 2017, when an agreement for 300 jets was reached. Since then, diplomatic tensions have cooled relations, resulting in only 51 additional orders, primarily for cargo planes.
It is not uncommon for China to use diplomatic events to announce significant aircraft orders, which can reflect political currents as much as commercial agreements. Aircraft purchases by Chinese airlines are subject to central government approval, often coinciding with diplomatic engagements. According to industry expert Matt Akers, the actual airline operator is typically determined closer to the delivery date. Despite the current announcement, there may still be potential for additional orders to emerge from this diplomatic visit. Boeing CEO Kelly Ortberg and GE Aerospace CEO Larry Culp were among the American business leaders who traveled with Trump to China, hoping to secure lucrative deals and resolve ongoing trade issues. Ortberg has previously emphasized the importance of support from the Trump administration in finalizing a major deal with China.