Boeing 787 Prices Could Jump By $40M In Worst-Case Scenario Amid Trump Tariffs, Warns AerCap Chief

AerCap Holdings AER CEO Aengus Kelly has raised concerns about the potential impact of tariffs on the pricing of Boeing Co. BA aircraft.

What Happened: Speaking on CNBC’s “Squawk Box,” Kelly expressed his apprehensions about the possible repercussions of tariffs proposed by President Donald Trump on Boeing’s aircraft pricing. He cautioned that in the most adverse situation, the cost of a Boeing 787 may increase by $40 million, a price that he believes would be unaffordable for most.

"In an absolute worst case scenario, say, a 25% increase across the board on tariffs, a tit-for-tat from both sides — a Boeing 787, the price will go up by $40 million," Kelly said.

Kelly further added that such a situation could prompt most airlines to switch to Airbus, providing the European manufacturer an opportunity to capture 75% to 80% of the global market. AerCap, the world’s largest aircraft leasing company, purchased 150 aircraft, helicopters, and spare engines from Boeing last year.

Despite the challenges faced by Boeing, Kelly acknowledged that AerCap has noticed an enhancement in the quality, reliability, and safety of Boeing’s products. He stressed that Boeing requires cash to deliver aircraft reliably and has made significant progress in terms of quality and safety over the past year.

Why It Matters: This warning from AerCap’s CEO comes at a time when Boeing is already striving to recover from production slowdowns caused by safety and quality issues last year.

According to a recent report, Boeing managed to maintain its pace from January and surpassed the delivery numbers from early 2024, signaling progress in its recovery efforts. Boeing’s commercial airplane backlog saw a slight decrease from 5,554 planes at the end of January to 5,528 by the end of February. However, despite this minor decline, the company surpassed its European competitor, Airbus, in deliveries for the second month in a row.

The potential tariff-induced price hike could, however, pose a new challenge to Boeing’s recovery and market position.

Previously, Wouter Dewulf, an air transport economist at the University of Antwerp told Politico, "Boeing is likely to absorb these additional material costs, leading to higher production expenses and reduced profit margins per aircraft.”

Boeing holds a momentum rating of 31.48% and a growth rating of 20.19%, according to Benzinga’s Proprietary Edge Rankings. The Benzinga Growth metric evaluates a stock's historical earnings and revenue expansion across multiple timeframes, prioritizing both long-term trends and recent performance. For an in-depth report on more stocks and insights into growth opportunities, sign up for Benzinga Edge.