There are not many winners in a trade war, but Boeing seems to take advantage of that of Donald Trump.
The aircraft manufacturer has received numerous orders as part of trade agreements between the United States and other countries. These sales could be Boeing’s salvation board, which comes out of a long and deep crisis. They also allow Trump to assert that his extraordinary trade policy helps the American manufacturing industry.
Hundreds of Boeing planes have been ordered this year as part of agreements with Indonesia and Japan, Bahrain, the United Arab Emirates, Saudi Arabia and Qatar.
“From his first mandate, his agreements often included this type of purchasing contracts,” said Bruce Hirsh, expert in commercial policy at Capitol Counsel, a Washington lobbying firm which represents aerospace companies. “Our business partners know this, so they have an eye on this type of expensive product they can offer to buy. »»
Some analysts believe that American negotiators did not have to do a lot of pressure for these countries to buy Boeing aircraft. Airlines, including those controlled by foreign governments, carefully plan these expensive purchases, sometimes for months, even years.
In addition, airlines have little choice, since Boeing and Airbus, in France, are the only two suppliers of large commercial planes.
Nevertheless, according to these experts, it is not surprising that Mr. Trump and his collaborators wanted to highlight the new orders of Boeing in the context of their trade agreements. The company employs tens of thousands of Americans and is one of the country’s main exporters.
The action takes off
Wall Street has also taken note of the announcement of these new orders, and the Boeing action course has been increasingly increasing since early April, when Trump announced his customs duties for many countries.
Analysts point out that other trade agreements could generate even more orders. Customers who have not yet ordered could feel pushed to do so now: delivery times are several years.
PHOTO RANDALL HILL, ARCHIVES REUTERS
Employees inspect a Boeing 787-10 Dreamliner in Charleston, South Carolina, where Boeing has a large factory.
Solicited for this article, Boeing did not respond. But he seems to appreciate the interest that Mr. Trump has in his business.
Boeing CEO, Kelly Ortberg, accompanied Mr. Trump during his visit to the Middle East in May, during which the agreement with Qatar was announced.
“If the president says to you:” Come with me and be sure that we will sign a big agreement that will create many jobs in the United States, what do you do? ” », Illustrates Adam Pilarski, president of Avitas, an aviation consultant.
But beware, said Mr. Pilarski, orders may not be as important as they seem.
Agreements, not necessarily contracts
The administration, other countries and Boeing have provided few details on these contracts. One might think that some of them are still the subject of complex negotiations between Boeing and airlines. Trump said this month that Indonesia was going to buy 50 Boeing planes. However, an Indonesian official said later that the contract was still under negotiation between Garuda, the state carrier, and Boeing.
Richard Aboulafia, Managing Director of the Cabinet-Conseil Aerodynamic Advisory, says he suspect that these “commands” are hardly more than what he calls to the joke of the “agreement protocols to go Luncher together”.
“The big work of negotiating details and financial conditions begins after the departure of the presidential plane,” he said.
Even if there are duly signed contracts, many orders would probably have been placed even without Mr. Trump, according to experts. In May, Qatar Airways, which operates many long-haul, ordered 150 grosters in Boeing. The announcement was particularly detailed.
“There have been press conferences, hand handles, it’s just if they have not embraced babies as in the electoral campaign,” notes Courtney Miller, who directs Visual Approach Analytics. According to him, this agreement would have been concluded anyway, but it was done faster to coincide with Mr. Trump’s visit.
Whether Mr. Trump has helped or not, many things may change by delivery date.
Boeing and Airbus both have orders for thousands of devices, which represents years of production. During this time, airlines can withdraw from the agreements, even if they have to give up their deposits. Customers can postpone delivery dates or reduce their orders.
A manufacturer can be open to such changes, especially if it allows it to sell these planes to another buyer with urgent needs.
Mr. Trump’s customs duties could affect the financial health of Boeing suppliers, and the retaliatory measures envisaged by trade partners in the United States, including the European Union, could harm Boeing sales.
This week, the low -cost airline Ryanair said it could postpone Boeing aircraft deliveries if the European authorities impose customs duties on American planes.
European leaders could take other harmful measures in Boeing. If the trade agreements concluded by the United States with other countries give an excessive advantage to Boeing, Europe could try to encourage other countries to order more aircraft in Airbus, according to experts.
“If we play this game, the long -term question is who will be the best,” says Miller. It relaunches a very old dynamic consisting in aligning the aviation economy on geopolitical interests. »»
This article was published in the New York Times.
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