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May 23, 2024

Boeing Resumes 787 Dreamliner Deliveries to China After Three Year Hiatus

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Dec 22, 2023

Boeing has delivered its first 787 Dreamliner aircraft to a Chinese airline in over three years, marking a major milestone in the restoration of commercial ties between the US plane maker and China.

The Boeing 787-9 Dreamliner was handed over to Shanghai-based Juneyao Airlines on Friday, in the company’s first direct delivery of a passenger jet to China since March 2019.

Background on Boeing-China Relations

Relations between Boeing and China hit turbulence in 2019, when China’s aviation regulator grounded the Boeing 737 MAX after two deadly crashes. Deliveries of new Boeing planes were halted amid increased regulatory scrutiny.

This was compounded by rising US-China trade and technology tensions. In 2020, Boeing called for trade dispute resolutions amid falling airplane sales to China.

The Boeing 737 MAX was finally cleared to resume flights in China in December 2022, after lengthy negotiations. The return of the MAX paved the way for resumption of Boeing deliveries.

Significance of 787 Delivery

The ceremonial handover of the 787 Dreamliner in Zhoushan is the first tangible sign of thawed relations between the US aviation giant and China.

Analysts state that the delivery signals improving bilateral trade ties between the two economic superpowers after a challenging few years. It may also provide much needed momentum for Boeing in the increasingly important Chinese aviation market.

Key Highlights:

- First Boeing passenger jet delivered to Chinese airline since March 2019 groundings
- Marks restart of deliveries after Boeing 737 MAX cleared to fly in China
- Signifies warming US-China business relations  
- Important boost for Boeing in a lucrative growth market

Boeing China President Sherry Carbary called the delivery a “milestone” that points to “progress in the US-China bilateral trade relationship.”

The company hopes to soon deliver 737 MAX jets to China as well, with over 140 planes destined for Chinese customers.

Why the Chinese Market Matters

As the world’s second largest economy, China represents tremendous potential for growth and demand for Boeing’s commercial airplanes over the next 20 years.

In its latest market outlook report, Boeing forecasts that China will need 9,360 new commercial airplanes through 2041, valued at $1.6 trillion.

China Aircraft Demand Forecast 2022-2041:  

- 9,360 new airplanes
- Worth $1.6 trillion   
- Equates to 6.3% of global demand

China is positioned to overtake the United States as the world’s largest aviation market over the next few years. Maintaining the Chinese sales channel is thus critical for Boeing as it emerges from successive crises.

The resumption of 787 Dreamliner and eventual 737 MAX deliveries will help Boeing recapture lost market share and play a key role in its financial recovery.

What Comes Next

While the 787 delivery represents a positive step forward, analysts say Boeing still faces significant challenges in rebuilding its position with Chinese airlines.

The company has a lot of ground to make up after losing orders and falling behind rival Airbus amid the bilateral tensions. Deep distrust also remains from the 737 MAX crashes.

However, clearing political and regulatory barriers now opens the door for Boeing to start delivering its substantial backlog and compete for new orders.

Ongoing US-China trade talks could provide a further boost if tariffs are lifted on jets imported to China. This would make Boeing planes more affordable for Chinese carriers.

Boeing must now focus on safely returning the 737 MAX fleet to service in China and regaining the confidence of Chinese travelers. Successful reintegration of the aircraft is key to reviving sales.

If Boeing can leverage its early mover advantage as the first foreign OEM to resume deliveries, analysts are upbeat about its prospects:

"We see this approval as positive for BA shares as it reflects a critical milestone was achieved in the turnaround process for this very important market." - Deutsche Bank

So while challenges persist, the tide seems to be turning for Boeing in China. The Dreamliner delivery sets an optimistic tone for Boeing’s China operations in 2024 and beyond.

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AiBot scans breaking news and distills multiple news articles into a concise, easy-to-understand summary which reads just like a news story, saving users time while keeping them well-informed.

To err is human, but AI does it too. Whilst factual data is used in the production of these articles, the content is written entirely by AI. Double check any facts you intend to rely on with another source.

By AiBot

AiBot scans breaking news and distills multiple news articles into a concise, easy-to-understand summary which reads just like a news story, saving users time while keeping them well-informed.

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