European aircraft manufacturer Airbus has seen its share prices rise as rumours of a major order from China loom. In an initial report published by Bloomberg and later by Reuters, it is understood that evidence points to ongoing talks for an order involving hundreds of planes.
Negotiations for this potential mega-deal with China have been ongoing for over a year, as Beijing assesses its options to support the rapid growth of domestic carriers amid continued trade tensions with the United States.
Trade War Could See Boeing Lose More Ground
As tensions between China and the United States persist, Boeing could lose even more ground to European competitors. Delays and ongoing issues with the 737 MAX—under scrutiny since its introduction in May 2016—have weakened Boeing’s standing. The company has also faced tribunals, court cases, and investigations not only related to the Ethiopian Airlines and Lion Air crashes but also involving its 777X program.
It was initially reported that the deal would include 300 narrow-body aircraft. However, recent updates suggest the order could increase to around 500 jets. An announcement is expected next month during a summit between European and Chinese leaders in Beijing.
Reuters reached out to Airbus for a comment on the potential order. However, the European manufacturer declined to comment at this time.
Possible Setback for Boeing Despite Recent Orders
If these reports prove accurate, it could spell disaster for Boeing. The company recently announced major 737 MAX orders during U.S. President Donald Trump’s state visit to the Middle East. Despite these deals, Boeing had previously stated that its focus would be on the Indian and Chinese markets—two of the fastest-growing regions for aircraft demand.
Yet Boeing has already lost ground to Airbus in India, with major orders going to Air India and IndiGo. Now, they risk falling behind in China as well.
Possible Announcement at Paris Air Show
Based on current reports, no official confirmation is expected before next month. Speculation suggests Airbus might wait until the Paris Air Show in July to make any official announcements. This would follow a notably quiet showing at the Farnborough Airshow in 2024.
In April last year, Reuters reported that Airbus was in talks over a major order ahead of a diplomatic visit, but no deal was finalized at the time. Bloomberg also noted that Airbus was aiming to sell 100 A330neo jets.
It’s worth noting that such reports should be treated with caution. China has often hinted at large aircraft orders timed with state visits, but these do not always lead to confirmed deals.
MoU or Firm Order?
Reports suggest that the order is likely to proceed. However, it remains unclear whether it will result in a firm order or a Memorandum of Understanding (MoU). Air India is reportedly preparing to place an order for 200 Airbus aircraft. This could pressure China to make a decision sooner, especially given current manufacturing backlogs that could delay deliveries of 500 jets by several years.
What About China’s C919?
Although current U.S.-China trade tensions have not completely halted progress, recent tariff increases could delay the Chinese-made C919. The aircraft manufacturer may struggle to obtain engines, potentially fueling greater demand for Airbus jets to meet China’s growing aviation needs.
China’s domestic air travel demand is expected to grow by 5% annually, making it one of the fastest-growing markets in the world.
If engine restrictions for the C919 are confirmed, this would likely rule out the aircraft as a short-term solution. However, should an order for 500 aircraft be placed, China could still scale it back in the future if its own C-Series aircraft become operational and capable of meeting demand.
