Boeing expects to firm up Chinese orders this year, predicts more deals will follow

The CEO predicts more commitments will follow as China’s carriers bulk up their fleets to meet travel demand.

Chinese leader Xi Jinping’s recent commitment to acquire hundreds of Boeing jets should result in a firm order for the US manufacturer before year-end, concluding Boeing’s nearly decade-long sales drought in China, according to chief executive Kelly Ortberg.

“The initial commitment of 200 [aircraft] will turn into an order later on in the year,” Ortberg said on 26 May during an investor conference hosted by financial firm Bernstein. “The way the process works is, once the government decides [on] a batch of narrowbody aircraft, they then allocate them to the Chinese airlines, and then we go work with the airlines to get a firm order.”

Boeing will negotiate and disclose those expected future deals on an “airline-by-airline basis”, Ortberg adds.

The comments come after Ortberg and a contingent of other US business leaders travelled to China in May during a state visit to the country by President Donald Trump.

During the summit, Trump revealed Xi’s commitment to buy Boeing jets.

“One thing he agreed to today — he’s going to order 200 jets. Boeing. Two hundred big ones. That’s a lot of jobs,” Trump told Fox News.

Some analysts had predicted the deal would be much larger, covering as many as 500 Boeing aircraft based on estimates of Chinese air travel growth.

Asked if the 200-strong deal was less than he expected, Ortberg says too much focus has been placed “on the initial quantity”. He calls the visit a “major, major accomplishment”, adding, “We hadn’t had an order in nearly a decade.”

Ortberg also predicts more commitments will follow, saying Chinese airlines “need well over 500 aircraft per year to support their GDP growth”.

It is unclear which Boeing aircraft types Chinese carriers might order or when Boeing would start delivering them.

The US company’s business ties with China withered in recent years amid broad US-China economic and political friction. Two Boeing 737 Max crashes and the resulting grounding of the type further strained Boeing’s relationships with Chinese regulators and customers.

A fresh order would mark China’s first major deal for Boeing aircraft since 2017, when China agreed during a prior Trump visit to buy 300 Boeing aircraft.

China’s ministry of commerce confirmed the 200-aircraft commitment on 20 May. It called aviation a “key area for deepening mutually beneficial cooperation” between the USA and China and said the commitment reflects Chinese carriers’ growth requirements.

The ministry added that, in return, the US agreed to provide China with “adequate supplies” of engine parts and components.

Numerous US aerospace manufacturers supply China’s aerospace industry with components. Those include the GE Aerospace-Safran Aircraft Engines joint venture CFM International, which manufactures Leap-1C turbofans for Chinese manufacturer Comac’s C919 commercial jet.