According to reports, a Boeing jet located at the company’s completion plant in China returned to the United States on Friday. Originally intended for delivery to a Chinese airline, the new aircraft was never handed over. Earlier in the week, the Chinese government had reportedly instructed airlines not to purchase new jets from Boeing and to obtain permission before accepting any planes that had already been ordered but not yet delivered.
The aircraft’s return is a development in the ongoing trade conflict between China and the U.S. The aircraft arrived at Boeing’s facility in Zhoushan, China, informed by the trade publication The Air Current, only to be directed to return to the U.S. Amidst a trade war involving the world’s two largest economies, companies operating in both countries, such as Boeing, find themselves vulnerable. Bloomberg had previously reported that Chinese government officials instructed local airlines not to order new Boeing aircraft and to seek approval before accepting deliveries of previously ordered planes.
One of the three 737 MAX jets, which had arrived at the Zhoushan location since March, reportedly returned to the U.S., according to Reuters. The Zhoushan facility, located in Eastern China, about three and a half hours from Shanghai, completes construction on aircraft by installing seats and painting the exterior. The status of the other planes at this facility remains unclear.
A Ministry of Foreign Affairs spokesperson for the People’s Republic of China responded to inquiries on Thursday, stating they were “not familiar” with reports of halting Boeing orders.
Even before potentially becoming a target of the Chinese government, Boeing was facing significant cost challenges from reciprocal tariffs between the U.S. and China. The company has one of the most complex supply chains, and its production costs in the U.S. could increase due to tariffs on imported parts. Concurrently, China’s 125% retaliatory tariffs on U.S. goods would make Boeing’s planes prohibitively expensive for Chinese carriers. In a communication to employees in March—preceding a tariff policy announcement by President Donald Trump—Boeing CEO Kelly Ortberg had highlighted the risks to costs and supply chain disruptions.
Kelly Ortberg also reiterated the adverse impact of widespread tariffs on Boeing’s business during a Senate hearing earlier in the month. Ortberg noted that Boeing sourced parts globally and sold the majority of its planes internationally. The tariffs posed a dual threat by raising production costs and decreasing sales.
Ortberg emphasized the importance of free trade at the Senate Commerce, Science, and Transportation Committee meeting, stating, “Free trade is very important to us. It’s important that we continue to have access to that market and that we don’t get in a situation where certain markets become closed to us.”
Fortune magazine’s request for comment from Boeing did not receive a response.
As a rapidly growing air travel market, China represents a significant opportunity for Boeing. The company projected that over the next 20 years, China would account for 20% of global air travel and double its commercial fleet to around 9,600 jets. Boeing opened its Zhoushan facility in 2018 during a prior trade dispute between the two nations, highlighting aviation as a “bright spot” in U.S.-China trade.
Nonetheless, the U.S.-China trade war has affected nearly all industries, including major industrial companies. Boeing’s stock initially dropped by 17% following Trump’s tariff policy announcement on April 2 but has largely recuperated. However, it fell by 2.5% following reports of China ordering a halt on new plane orders.
Boeing’s standing as a key American manufacturer is advantageous, as the Trump administration has expressed a commitment to protecting such enterprises. Ronald Epstein, a Bank of America aerospace analyst, indicated this week that the administration could not overlook Boeing’s importance.
The issues concerning Boeing’s aircraft deliveries to China have captured the attention of President Trump. In a social media post on Tuesday, Trump mentioned that China had “just reneged on the big Boeing deal,” stating they would not take possession of fully committed aircraft.
This information was initially published by Fortune.com.
