BUSINESS US biz giants including Boeing eye Chinese market as soon as possible

BUSINESS

US biz giants including Boeing eye Chinese market as soon as possible

Global Times

23:06, June 04, 2021

Boeing 737 Max airplanes sit parked at the company's production facility on November 18, 2020 in Renton, Washington. Photo: VCG

As an aircraft manufacturer which has only received one order from China for 737 MAX plane over the past four years, US plane maker Boeing has never hidden its desire for the Chinese market.

Speaking at a virtual conference on Thursday, Boeing Chief Executive Officer Dave Calhoun once again showed his concern about Sino-US trade relations, saying he could not predict when a "thaw out" would open up jet deliveries in one of the world's fastest growing aviation markets, according to Reuters.

Boeing's comments come only days after China and the US restarted more regular communications addressing economic recovery and trade, agreeing on joint efforts to solve several specific problems in a practical way, and Chinese market watchers said it shows the US giants are eager to win back the Chinese market as soon as possible.

"Boeing is supposed to be the largest beneficiary of the restoration in bilateral relations, given China accounts for an important portion of its plane orders," Qi Qi, a market watcher, told the Global Times on Friday.

Qi said Boeing hopes China could lift the flying ban for its 737 MAX as soon as possible, and hope Chinese airlines can order more aircraft from it, since it has been bleeding for six consecutive quarters.

Due to the global grounding of the 737MAX after major air crashes and the impact of the epidemic on the civil aviation industry, Boeing delivered only 157 aircraft in 2020, and its production fell to its lowest level in nearly 50 years.

Meantime, Airbus delivered a total of 99 aircraft to Chinese clients, accounting for 17.5 percent of global deliveries.

In April, Calhoun called on the US government to normalize trade relations with China, saying aircraft orders from China will be "key" to the company's long-term health. In the previous month, he also urged the US to keep human rights and other disputes separate from trade relations with Beijing, and warned that Airbus would gain if the US plane maker was locked out of China, according to Reuters.

China has played an important role in Boeing, as more than 10,000 Boeing aircraft are equipped with world-class parts made in China, and one out of every four civilian aircraft produced by Boeing has been delivered to China.

However, the orders from Chinese airlines have dramatically declined in recent years as trade between the top two economics faced disputes.

Data from Boeing showed that there were 32 orders from Chinese clients from 2017 to April 30 of 2021, but zero new orders from China between 2018 and 2019. In 2020, there were only three orders, including one order for 737 MAX from ICBC Leasing and two orders for 777F from China Cargo.

In comparison, from 2012 to 2016, Boeing won 6,146 orders from the world, of which 733 were from China, accounting for 11 percent of its global orders.

China's recovered aviation market is also another driving force for Boeing's attention on China, Lin Zhijie, an independent market watcher, told the Global Times on Friday.

FedEx also said in a note sent to the Global Times on Friday that it believes that mutually beneficial trade relations and constructive dialogue are the best ways to achieve strong, resilient supply chains between the US and China.

The company said they hope China and the US continue to seek areas of cooperation that will build a solid foundation for a long-term relationship and their mutual prosperity.

However, Biden signed an order Thursday amending a ban on US investment in Chinese companies begun by his predecessor, naming 59 firms with ties to China's military or in the surveillance industry, including Aviation Industry Corporation of China, which is also an important partner of Boeing.

Before the mass-production of COMAC's C919, the Boeing 737 series aircraft was still the first choice for domestic airlines. The US government should value trade complementarities between China and the US, and promote trade back to the right track, which is good for people from China and the US, Qi said.

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