Boeing to resume airplane deliveries to China next month, ramp up Max production, CEO says
Boeing 's airplane deliveries to China will resume next month after handovers were paused amid a trade war with the Trump administration, CEO Kelly Ortberg said Thursday, as he brushed off the impact of tit-for-tat tariffs with some of the United States' largest trading partners this year.
Ortberg had said last month that China had paused deliveries.
'China has now indicated … they're going to take deliveries,' Ortberg said. The first deliveries will be next month, he told a Bernstein conference on Thursday.
Boeing, a top U.S. exporter whose output of airplanes helps soften the U.S. trade deficit, has been paying tariffs on imported components from Italy and Japan for its wide-body Dreamliner planes, which are made in South Carolina, Ortberg said, adding that much of it can be recouped when the planes are exported again.
'The only duties that we would have to cover would be the duties for a delivery, say, to a U.S. airline,' he said.
Regarding the rapidly changing trade policies that have included several pauses and some exemptions, Ortberg said, 'I personally don't think these will be … permanent in the long term.'
He reiterated that Boeing plans to ramp up production this year of its best-selling 737 Max jet, which will require Federal Aviation Administration approval.
The FAA capped output of the workhorse planes at 38 a month last year after a door plug that wasn't secured when it left Boeing's factory blew out midair in the first minutes of an Alaska Airlines flight.
Ortberg said the company could produce 42 Max jets a month by midyear and assess moving up to 47 a month about half a year later.
The company's long-delayed Max 7 and Max 10 variants, the largest and smallest planes in the narrow-body family, are scheduled to be certified by the end of the year, he said.
Many airline executives have applauded Ortberg's leadership since he took the reins at Boeing last August, tasked with stemming years of losses and ending reputational and safety crises, including the impact of two fatal Max crashes.
CEOs have long complained about delivery delays from the company that left them short of planes during a post-pandemic travel boom.
'I do think Boeing has turned the corner,' United Airlines CEO Scott Kirby told CNBC's ' Squawk Box ' earlier Thursday. He said supply chain problems are limiting deliveries of new planes overall.
'We over-ordered aircraft believing the supply chain would be challenged,' he said.
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