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Boeing Resumes Deliveries to China

Boeing Resumes Deliveries to China Amid Easing Trade Tensions
Boeing (NYSE: BA) delivered 60 aircraft in June, representing a 27% increase compared to the same period last year. Notably, this included the company’s first shipments to China since Beijing eased its restrictions on Boeing planes earlier this year. The deliveries to Chinese carriers consisted of five 737 Max jets, one 787 Dreamliner, and two 777 freighters, marking a significant reopening of a vital revenue channel for the U.S. aerospace manufacturer following China’s decision in April to lift its ban on Boeing aircraft.
Delivery Performance and Market Context
June’s total deliveries encompassed 42 737 Max airliners, nine 787 Dreamliners, four 777 freighters, and five 767s, three of which were configured as KC-46 tankers. Southwest Airlines (NYSE: LUV) received ten Max jets during the month. Airbus (EADSY), Boeing’s primary competitor, maintained a comparable delivery pace, dispatching 63 aircraft over the same period.
The resumption of deliveries to China is widely interpreted as a positive indicator of improving U.S.-China trade relations, a development that has been welcomed by investors and industry analysts alike. Nevertheless, Boeing continues to confront significant hurdles, including navigating China’s intricate regulatory framework, managing persistent supply chain disruptions, and addressing unresolved tariff disputes that could affect future sales prospects.
Strategic and Competitive Challenges
Aircraft deliveries are a critical source of cash flow for manufacturers, as they trigger substantial payments from customers. For Boeing, accelerating deliveries is particularly important as the company seeks to reduce a backlog of approximately 280 jets accumulated during the first half of the year, a consequence of earlier production delays and quality control issues.
Competition within the Chinese aviation market remains intense. Airbus is expected to escalate its efforts to expand market share, while China’s state-owned Commercial Aircraft Corporation (COMAC) stands to benefit from the U.S. lifting license suspensions on GE jet engines, potentially intensifying competition in the region’s aerospace sector.
In June, Boeing recorded 116 gross orders, including 54 for the 737 Max and 62 for the 787 Dreamliner, although this represented a slowdown from the peak order volume seen in May. Year-to-date, the company has secured 668 gross orders, reflecting a gradual recovery despite some cancellations, such as Singapore Airlines reducing its Max orders by three.
As Boeing resumes deliveries to China and continues to address ongoing operational and geopolitical challenges, its performance will remain under close scrutiny from investors and industry competitors alike.

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