LONDON (ShareCast) - (Sharecast News) - China has instructed its domestic airlines to halt deliveries of Boeing aircraft and suspend purchases of US-made aviation equipment and parts, it emerged on Tuesday, deepening a widening trade dispute with the United States.
The move followed Beijing's announcement of new retaliatory tariffs, raising the total levy on US goods to 145%, in response to recent tariffs imposed by Washington.

According to Bloomberg, the latest measures targeted Boeing directly, with the new Chinese tariffs - 125% announced last weekend - rendering deliveries of US-built aircraft and components economically unviable.

Chinese authorities were reportedly exploring financial support options for domestic airlines leasing Boeing planes, which were now subject to higher operating costs.

About 10 Boeing 737 MAX jets were currently awaiting entry into Chinese airline fleets, including units for China Southern Airlines, Air China, and Xiamen Airlines.

Some of the aircraft were stationed in Seattle or at Boeing's completion center in Zhoushan, eastern China.

Jets for which delivery procedures were finalised before the 12 April tariff implementation could still be allowed into the country on a case-by-case basis.

Boeing, along with the Civil Aviation Administration of China and major Chinese carriers, were not commenting on the developments as of Tuesday morning London time.

Separately, Juneyao Airlines recently postponed the delivery of a Boeing 787-9 Dreamliner, signaling growing operational caution among Chinese airlines.

The freeze would compound Boeing's challenges in China - a market expected to account for 20% of global aircraft demand over the next 20 years.

Although nearly a quarter of Boeing's aircraft were delivered to China in 2018, new orders from the country had since largely dried up due to trade tensions and safety issues.

Boeing's standing was weakened by the lengthy 737 MAX grounding, ongoing regulatory scrutiny, and a recent quality control failure involving a detached door plug.

Despite increasing reliance on Airbus and the emergence of China's domestically built Comac C919, Chinese carriers still operate large Boeing fleets.

The maintenance and replacement needs of the aircraft meant China's aviation sector remained vulnerable to continued supply chain disruptions - an area Boeing has already flagged as a risk due to ongoing geopolitical friction and the lingering effects of the Covid-19 pandemic.

At 0448 EDT (0948 BST), shares in the Boeing Company were down 2.76% in premarket trading in New York, at $154.88.

Reporting by Josh White for Sharecast.com.

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