Boeing is considering reselling dozens of planes that it cannot deliver to China due to a tariff war between the world's two largest economies. The move is seen as an effort to avoid a surplus of inventory as happened during previous trade crises, thus helping the company generate cash and pay down debt by selling some of its service units.
While global demand for its planes remains high, Boeing acknowledges that many new customers are interested, but customizing planes that have been configured to Chinese customers' original specifications can cost millions of dollars. The company is now exploring alternative markets including India, Latin America and Southeast Asia, with Air India mentioned as a potential buyer.
Three 737 MAX aircraft built for Chinese airlines were recently sent back to the US, one of which was for Air China. Boeing said it will no longer build planes for customers who refuse to take delivery, and is studying options to remarket the 41 planes that are completed or in production.
China, which is also facing pressure in its aviation market, is still seen as needing new aircraft, but negotiations and large purchases have been stalled due to geopolitical tensions. At the same time, Airbus is also eyeing opportunities to secure large orders, with talks involving up to 500 aircraft, although they have not yet been finalized.
