Boeing will resell some Max jets ordered by Chinese airlines

Boeing officials said they will find new buyers for some Boeing 737 Max jets that were built for Chinese airlines but cannot be delivered because the Chinese aviation regulator did not allow the plane to fly after two fatal accidents.

Boeing hopes the move will reduce its inventory of undelivered Max jets, which have accumulated while planes were on the ground around the world.

However, the decision risks increasing tension between the aircraft manufacturer and China, which was once Boeing’s largest market for the Max.

As of June 30, Arlington, Virginia-based Boeing had 290 undelivered 737s in inventory, about half of which were destined for China, company officials said. The company did not disclose how many could be resold to new buyers.

Boeing’s hopes were raised last December when China’s aviation regulator took an important step to allow airlines to resume using the Max. In February, Chinese airlines performed flight tests. . But China’s Civil Aviation Administration did not take final steps to allow Max’s flights and deliveries to resume, which Boeing officials blame for the COVID-19 blockade.

Meanwhile, the company was running out of patience.

“We have postponed decisions on those planes for a long time. We cannot postpone this decision forever, “Boeing Chief Financial Officer Brian West said Thursday.” So we will start re-marketing some of those airplanes that would otherwise have been destined for our Chinese customers. “

China “is an important market,” and Boeing did not take the decision lightly, West said at a Morgan Stanley investor conference, but expressed confidence that Boeing could find new buyers for the planes, which cost $ 100 million. dollars up, although airlines regularly get deep discounts.

China is the last major market where the Max is still awaiting approval to fly. The U.S. Federal Aviation Administration approved Boeing’s changes to the aircraft in late 2020, and regulators in Europe, Canada and Brazil have followed suit.

The importance of the Chinese market for Boeing was highlighted in July, when the three largest Chinese airlines ordered nearly 300 aircraft from its European rival Airbus.

U.S. relations with China were strained during the administration of former President Donald Trump, who waged a trade war with China. Boeing CEO David Calhoun said Thursday that free trade with China has helped the company, but that recent “geopolitical events” will “slow us down”.

“I think we’ll be back someday,” Calhoun said at a US Chamber of Commerce event. “I just don’t think it’s a day soon.”

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