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Boeing’s hopes of landing a new mega-order from China during this week’s summit between US President Donald Trump and Chinese President Xi Jinping are fading, according to sources close to the matter. With its ambitions for an order for up to 500 jets now highly unlikely, 
Boeing is reportedly focusing on finalizing a 200-aircraft deal announced in May, which has yet to be formally converted to firm orders.
As Simple Flying reported earlier this summer, this 200-jet commitment has been at risk of falling apart due to a dispute over engines, spare parts and maintenance. Analysts now say it would represent a significant victory for the planemaker if it can save this deal, which may involve reducing the order from 200 to 150 planes or fewer.
Boeing Not Hopeful Of New Orders From China
As reported by Reuters, people familiar with the negotiations said that the prospect of securing new Chinese aircraft orders was fading ahead of the summit. Following a previous summit in May, China committed to an “initial tranche” of 200 aircraft, with Boeing expecting to secure a mega-order for up to 500 jets.
In fact, President Trump cited an even larger figure of up to 750 aircraft, which would have represented a triumphant resurgence in the Chinese market for the US planemaker. However, indicators in the lead-up to this week’s summit have been far less optimistic, with Boeing CEO Kelly Ortberg downplaying the prospect of a larger order at a Morgan Stanley conference last week.
The company has struggled in the Chinese market for the better part of a decade, while European rival Airbus has significantly increased its market share and influence. Other matters are expected to take center stage at the summit, with new aircraft orders unlikely to be on the agenda. Scott Kennedy, Center for Strategic and International Studies, told Reuters,
“A lot of trade relationships are hostage to these meetings. New aircraft orders would be a benefit, but I don’t think that’s a necessity for this summit.”
200-Jet Order Could Drop To 150 Planes
China’s May commitment for up to 200 Boeing aircraft also hangs in the balance, with sources suggesting the order could be scaled down to around 150 aircraft or fewer. US Trade Representative Jamieson Greer said earlier this week that around 140 aircraft orders “are in a good state,” with a further ten orders in the process of being finalized.
The deal has stalled due to a dispute over access to engines, spares and maintenance support, with Beijing reportedly seeking guaranteed access to US parts and support. Richard Aboulafia from aerospace consulting firm AeroDynamic Advisory told Reuters that it would prove “a victory” for Boeing if this 200-airplane order can be saved.
If there are any formal announcements on aircraft orders this week, they will almost certainly pertain to the existing 200-jet commitment, rather than any new orders. When announced in May, the specific aircraft models involved in the deal were not disclosed, although the Boeing 737 MAX is expected to make up the bulk of units.
Boeing’s Position In China Remains Precarious
Boeing’s difficulties in China stretch back almost a decade and have been exacerbated by political tensions between Washington and Beijing, something that rival Airbus has not had to contend with. Boeing’s last major deal came in 2017, when China agreed to buy 300 aircraft worth more than $37 billion at list prices.
A strong presence in China in the coming decades will be of huge importance to Boeing’s long-term commercial ambitions. According to both Airbus and Boeing market forecasts, China is expected to order around 9,000 new jets by 2045, more than any other global region. The country also remains committed to developing its homegrown aircraft range through state-owned COMAC, although progress and production have been slow.
