Boeing: China will buy 7,690 new aircraft. But there is Trump's trade war

Boeing (ba) has made an optimistic forecast for China, an aviation market that will soon become the largest in the world. The planner must also overcome a titanic trade war that President Donald Trump is stepping up.

The country will need 7,690 new aircraft worth $ 1.2 trillion over the next two decades, said Tuesday the plane in Chicago. According to Randy Tinseth, vice president of marketing at Boeing, this represents a 6% increase over the expectations of the Chinese middle class.

"The future of commercial aviation in China is very exciting," he said in a statement.

But this prospect could be threatened if Trump implements a proposal to impose tariffs on an additional $ 267 billion of Chinese exports, in addition to the $ 200 billion that his administration is developing and $ 50 billion. already covered. This would essentially cover everything China exports and could trigger retaliation in kind by Beijing, a measure that could endanger Boeing's airliners, which have been left behind until now.

The Asian economy of $ 12.2 trillion, the world's leading source of overseas travelers, is a crucial market for both Boeing and Airbus (eadsy), with continental carriers increasing capacity and adding new destinations across the world. world. The country accounted for about 13 percent of Boeing's revenue last year, according to data compiled by Bloomberg.

In the battle for market dominance, which the International Air Transport Association believes will surpass the United States to become number one in four years, the American company has managed to maintain its lead over its European rival.

While China has said it will be forced to retaliate against all US tariff measures, it is unclear whether President Xi Jinping would include airliners on his list of US targets. The United States imported $ 505 billion worth of Chinese goods in 2017, according to Census Bureau figures.

In a warning issued in April, China had proposed an additional 25% tariff on an older generation of Boeing 737, which was close to the end of its production, but which is no longer in his opinion since.

At the Farnborough Air Show in July, Boeing General Manager Dennis Muilenburg and Airbus Chief Commercial Officer Guillaume Faury said the aerospace industry was flourishing through free trade and that no one wins such a war.

In its forecast on Tuesday, Boeing said China would need 5,730 single aisle aircraft, accounting for 75 percent of total new deliveries over the next two decades. The country would need 1,620 large aircraft, three times the size of the country's current fleet. China currently has 15 percent of the world's commercial fleet, and that number is expected to rise to 18 percent by 2037, Boeing said.

In August, Boeing raised its global forecast by 4% to 42,700 aircraft valued at more than $ 6 trillion. Forecasts are based on a mixture of economic data and airline user data and do not include the potential effects of geopolitical or economic upheavals.

Decision makers in China could still hit Boeing by favoring Airbus for future orders. Prime Minister Li Keqiang said in June that his government is ready to strengthen cooperation with Airbus.

But for the moment, Boeing seems to be isolated from tensions with China. It delivered 202 aircraft to Chinese airlines in 2017, compared with 176 by Airbus.

China itself is expected to participate in the commercial aircraft race over the next two decades. The Chinese company Commercial Aircraft Corp., known locally as Comac, has been doing test flights for its C919 narrow jet since May. The company claims to have accumulated more than 800 orders from Chinese carriers and lessors.