China has reportedly resumed accepting Boeing Co. BA aircraft deliveries after a month-long pause, following a significant trade breakthrough with the United States. The development comes as both nations attempt to ease tensions and steady economic ties.
What Happened: Officials in Beijing have told local airlines that they may now proceed with accepting new aircraft from Boeing, Bloomberg reported, citing sources. Airlines have been granted the flexibility to schedule the incoming jets on the basis of their operational needs.
Prior to this, multiple planes were returned to the United States after Chinese airlines declined to accept them due to tariffs, which China's commerce ministry remarked was hurting the sector.
In response, Boeing indicated its readiness to present the undelivered jets to new buyers in other markets.
Boeing did not immediately respond to Benzinga's request for comment.
Why It Matters: Around 50 Boeing aircraft are now expected to reach Chinese airlines this year, sparing the company the expense and delays of seeking replacement customers, and confirming a regular inflow of revenue once deliveries are made.
China is projected to create one-fifth of the world's airplane demand over the next two decades. In 2018, it accounted for nearly 25% of Boeing's total production, Bloomberg noted.
As the U.S. and China have agreed to halt their trade dispute for 90 days, reducing most of their retaliatory tariffs from 125% to 10%, Boeing is set to benefit, with shares climbing on Monday.
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