Boeing's 500-Jet China Deal Hinges on Thawing Trade Tensions

Boeing is nearing the finalization of a potential 500-jet sale to China, marking what could be the largest aviation deal between the two nations in nearly a decade, according to multiple reports. The U.S. planemaker, currently in talks with Chinese authorities, is working out the details of the order, which is expected to include specifications on jet models, delivery schedules, and pricing. The transaction remains contingent on resolving broader trade tensions between the U.S. and China, which have persisted since President Donald Trump first imposed tariffs on Chinese goods in 2017. These tensions were further exacerbated during President Joe Biden’s term and intensified again after Trump’s 2024 re-election and the imposition of additional tariffs.

The deal, if finalized, could serve as a cornerstone in broader trade negotiations and reflect a significant thaw in Boeing’s relationship with China, where the company has seen a dramatic decline in orders over the past few years. Between 2017 and 2021, Boeing secured substantial jet orders during Trump’s first term, often linked to high-profile diplomatic visits. However, China halted major purchases due to trade tensions and tariffs, favoring Airbus and, to a lesser extent, its domestically developed COMAC C919. The prolonged absence of Chinese orders has been a blow to Boeing’s global market share and has contributed to the company’s financial challenges, despite recent operational improvements under CEO Kelly Ortberg.

Chinese airlines are currently being surveyed to gauge demand for the upcoming order, with a particular focus on the 737 Max series. This model, which was grounded globally for nearly two years following two fatal crashes in 2018 and 2019, is now in the process of regaining regulatory approval and operator confidence. Analysts note that China’s aviation market is projected to double its fleet to nearly 9,800 planes over the next two decades, driven by rapid economic growth and urbanization. This demand is expected to outstrip the production capacity of COMAC and Airbus, reinforcing the strategic necessity for China to resume large-scale purchases of foreign-made aircraft.

Complicating the Boeing negotiations is a leadership vacuum in China. Alvin Liu, Boeing’s former top executive in the country, left the position recently, and Carol Shen has been appointed as interim president of Boeing China. Liu’s departure has raised concerns about the continuity of relationships with Chinese regulators and airline executives. Nevertheless, the company remains optimistic that the deal can be concluded, with a potential announcement aligned with a high-profile diplomatic event such as a Trump visit to China or the APEC summit in South Korea this October.

Investors have responded cautiously to news of the potential deal, with Boeing shares rising modestly following reports of progress in negotiations. The outcome of this deal could have far-reaching implications for Boeing’s long-term recovery, as well as for the broader U.S.-China trade relationship. The success of the talks will depend on both companies’ ability to navigate the complex geopolitical landscape and demonstrate a renewed commitment to collaboration despite ongoing economic and political challenges.

Source: [1] Boeing in talks to sell up to 500 jets to China, Bloomberg (https://www.reuters.com/business/aerospace-defense/boeing-talks-sell-up-500-jets-china-bloomberg-news-reports-2025-08-21/) [2] Boeing eyes sale of up to 500 planes to China: report (https://www.foxbusiness.com/economy/boeing-eyes-sale-up-500-planes-china-report) [3] China, Boeing appear near massive order: report (https://leehamnews.com/2025/08/21/china-boeing-appear-near-massive-order-report/)