Boeing CEO Kelly Ortberg Confident Trade War Won't Hinder Financial Recovery or Aircraft Deliveries

US • Business • 04/23 16:30
Boeing CEO Kelly Ortberg Confident Trade War Won't Hinder Financial Recovery or Aircraft Deliveries

Boeing CEO Kelly Ortberg stated that despite halted aircraft deliveries to China due to U.S.-China trade tensions, Boeing's financial recovery and delivery targets remain on track. Ortberg plans to redirect undelivered aircraft to other customers, citing strong global demand for the 737 Max. Boeing's first-quarter results exceeded expectations, with a reduced net loss and increased revenue. The company is managing tariff impacts and remains engaged with the White House on trade issues. Boeing's shares rose over 6% following the earnings report, reflecting investor confidence in its recovery strategy.

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Boeing CEO Kelly Ortberg Confident Trade War Won't Hinder Financial Recovery or Aircraft Deliveries

Boeing CEO Kelly Ortberg stated that despite halted aircraft deliveries to China due to U.S.-China trade tensions, Boeing's financial recovery and delivery targets remain on track. Ortberg plans to redirect undelivered aircraft to other customers, citing strong global demand for the 737 Max. Boeing's first-quarter results exceeded expectations, with a reduced net loss and increased revenue. The company is managing tariff impacts and remains engaged with the White House on trade issues. Boeing's shares rose over 6% following the earnings report, reflecting investor confidence in its recovery strategy.

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Boeing Maintains Confidence Amid Delivery Disruptions

Speaking in a televised interview with CNBC, Boeing CEO Kelly Ortberg confirmed that Chinese airlines have stopped accepting new aircraft due to the ongoing trade dispute between the U.S. and China. Ortberg revealed that three Boeing aircraft were ready for delivery in China, but two had already been returned to Seattle as a result of Beijing’s refusal to proceed with the handovers.

Despite this disruption, Ortberg remained firm in his outlook. “I’m not going to let this derail the recovery of our company,” he said. “We’ll give the customers an opportunity if they want to take the airplanes. That’s what we prefer to do. But if not, we’re gonna remarket those airplanes.”

Boeing had originally planned to deliver approximately 50 aircraft to China in 2025. Ortberg acknowledged the challenge but said the company would be “pretty pragmatic” moving forward. “For those airplanes that haven’t been built yet, we’ll be looking to maybe redirect those to other customers,” he added. “For the airplanes that have been built, we call it remarketing. There’s plenty of customers out there looking for the Max aircraft.”

Financial Results Exceed Expectations

Boeing’s first-quarter financial results, released Wednesday, provided a boost to investor confidence. The company reported an adjusted loss of 49 cents per share on revenue of $19.5 billion, outperforming analyst expectations. Analysts surveyed by Zacks Investment Research had forecast a loss of $1.54 per share on revenue of $19.29 billion.

The company also significantly reduced its cash burn, bringing it down to approximately $2.29 billion from nearly $4 billion in the same period a year earlier. Boeing’s net loss for the quarter stood at $123 million, a notable improvement from the $343 million loss reported in the year-ago period. Revenues rose 18% year-over-year.

Shares of Boeing, based in Arlington, Virginia, rose more than 6% in morning trading following the earnings announcement. Ortberg described the company’s turnaround as “on track,” citing improved operational performance and a continued focus on safety and quality.

“Our company is moving in the right direction as we start to see improved operational performance across our businesses from our ongoing focus on safety and quality,” Ortberg said in a press release.

Trade Tensions and Tariff Impacts

The halt in Chinese deliveries comes amid heightened trade tensions between the U.S. and China. On April 2, President Donald Trump announced sweeping tariffs that triggered volatility in financial markets and raised fears of a global economic slowdown. The administration later placed a partial 90-day hold on the import taxes but also increased tariffs on Chinese goods to as much as 145%.

Boeing executives estimate that U.S. tariffs on raw materials and components will cost the company less than $500 million annually. However, under a U.S. duty drawback program, Boeing can recover customs duties when planes are exported, potentially offsetting some of the financial burden.

Ortberg noted that Boeing’s engagement with the White House on trade matters has been “very dynamic.” While the company continues to monitor the situation closely, Ortberg reiterated that the trade war would not prevent Boeing from achieving its financial and operational goals.

Broader Industry and Government Context

The trade standoff has drawn attention from U.S. government officials. Treasury Secretary Scott Bessent recently described the ongoing tariff conflict as “unsustainable” and expressed hope for a “de-escalation” between the world’s two largest economies.

Meanwhile, Boeing continues to implement quality control enhancements under the scrutiny of federal regulators, aiming to restore confidence among lawmakers and customers. These efforts are part of a broader strategy to stabilize the company following years of turbulence related to the 737 Max grounding and pandemic-related disruptions.

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