Boeing Secures Massive China Order, Ending Years-Long Sales Drought

Boeing is close to securing a massive aircraft order from China, potentially involving up to 500 jets, which could mark the end of a years-long sales drought in China. The deal is contingent on progress in easing US-China trade tensions. Boeing shares rose 1.94% on the news, with the stock up 27% YTD.

Boeing is nearing a significant breakthrough in securing a massive aircraft order from China, potentially involving up to 500 jets. This potential deal could mark the end of a prolonged sales drought in the world's second-largest aviation market. The news has lifted Boeing's stock, which is up 1.94% on the day, following a 27% year-to-date increase [1].

The negotiations between Boeing and Chinese officials are ongoing, with details such as aircraft types, delivery schedules, and the final order size still under discussion. The deal is contingent on progress in easing US-China trade tensions, which have been a significant barrier to Boeing's sales in China [2].

Chinese officials have already begun consulting domestic airlines about their future fleet needs, signaling preparations for a large-scale purchase. This potential order could rival China's recent agreement with Airbus for up to 500 planes, which has not been publicly announced [1].

Boeing's stock performance has been bolstered by its turnaround efforts under CEO Kelly Ortberg. The company reported stronger-than-expected revenue for the second quarter, driven by a sharp rise in commercial aircraft deliveries. However, it also reported an adjusted loss per share wider than Wall Street projections [1].

While the talks could collapse, the potential order would be a significant boost for Boeing, helping it narrow the gap with rival Airbus, which has pulled far ahead in China in recent years. Boeing forecasts that China's commercial fleet will more than double to 9,755 aircraft over the next two decades, far outpacing the output of its state-backed competitor, Comac [1].

The aerospace giant is also facing potential production hindrances, with over 3,200 workers rejecting a new contract offer in Illinois and Missouri [1].

References:
[1] https://www.benzinga.com/markets/large-cap/25/08/47258350/potential-500-plane-order-could-end-boeings-china-drought-report
[2] https://finance.yahoo.com/news/boeing-talks-sell-500-jets-111105949.html