U.S. companies prefer negotiations, long-term policy to confrontation
A number of large commercial entities from the United States including Boeing, General Motors and the American Soybean Association, have urged the U.S. government to resolve the simmering trade dispute with China through constructive dialogue, and to seek sustainable trade policies.
Their response came after China announced plans to impose 25 percent supplemental tariffs on 106 U.S. products including automobiles, commercial aircraft, chemicals and soybeans on Wednesday as a response to tariff proposals from the Trump Administration.
Items on the latest list from Beijing include planes with an operating empty weight between 15,000 kilograms and 45,000 kg, which covers a series of Boeing 737 planes.
Some single-aisle Boeing aircraft, including the B737-700, B737-800, B737-900 and B737 MAX 7, are among the major plane models that Boeing exported to China over the past few years, and are among the products likely to see higher tariffs.
As a possible trade war will affect businesses from both countries, Boeing said that while both governments have "outlined positions that could do harm to the global aerospace industry, neither has yet imposed these drastic measures", the group said in a statement.
"We will continue in our own efforts to proactively engage both governments and build on the recent assurances by U.S. and Chinese leaders that productive talks are ongoing. A strong and vibrant aerospace industry is important to the economic prosperity and national security of both countries," the U.S. aircraft manufacturer said.
From 2018 to 2020, Air China, China Eastern Airlines and China Southern Airlines plan to purchase more than 300 aircraft from the B737 series, according to their earnings reports.
China is now the world's largest aircraft market by sales volume. The country imported 60 billion yuan ($9.52 billion) of Boeing's products and accounted for 26 percent of Boeing's global production, said Lin Zhijie, an aviation industry analyst and columnist at Carnoc－China's largest civil aviation web portal.
"There is no significant difference in performance between Airbus SE's aircraft and Boeing's, and the product certainly can be replaced with a strong alternative," he said.
The homegrown C919 large passenger jet, and the A320 series made by European aircraft manufacturer Airbus－the archrival of Boeing－are competing models of the narrow-body B737.
Meanwhile, Boeing is building a B737 MAX completion and delivery center in Zhoushan, Zhejiang province, and it is expected to go into operation in May. By the end of this year, Boeing plans to deliver the first B737 MAX plane directly from Zhoushan to a domestic airline.
General Motors also said in a statement released on Wednesday that the company supports a positive trade relationship between the U.S. and China, and hopes they value a vibrant auto industry and understand the interdependence between the world's two largest automotive markets.