By James T. Areddy

A Chinese halt on Boeing aircraft purchases, if sustained, risks backfiring on China's homegrown plane maker Comac before the upstart is globally competitive.

In a rapidly collapsing U.S.-China relationship, with sky-high tariffs that threaten to wipe out most bilateral trade, spillover into the multibillion-dollar aviation sector could spell major problems for both economies.

Aircraft makers view China as the largest future commercial aviation market and for years Boeing was the top U.S. industrial exporter to the country. The U.S. exported nearly $12 billion in aircraft, spacecraft and parts to China last year, according to International Trade Administration numbers, and imported virtually nothing.

To offer its airlines an alternative supplier, China's government has invested tens of billions of dollars into Shanghai-based aircraft maker Comac to produce domestic equivalents of commercial planes from Boeing and Europe's Airbus.

Now, China's airlines have been told to withhold new orders for Boeing aircraft and seek approval before taking delivery on plane orders, people familiar with the situation told The Wall Street Journal this week. Nevertheless, Comac's slow plane production means it is in no position to fill order books quickly, and if anyone benefits from the U.S.-China spat it will likely be Airbus.

Moreover, by inserting aircraft into the trade war with the U.S., Beijing is inadvertently exposing a vulnerability, highlighting American power over Comac. The company's leading commercial aircraft model, the C919, is airworthy because of critical technology from U.S. companies including GE Aerospace, Honeywell International and RTX.

President Trump has significant power to block American companies from supplying Comac, and the Journal reported in 2020 that his first administration had considered doing so. Washington has repeatedly cited U.S. national-security considerations to prohibit supplying China other technology, such as advanced semiconductors. Just this week, Nvidia revealed new Trump administration restrictions on its China chip exports.

China pitches the narrow-body C919 as its answer to the Boeing 737 MAX and Airbus A320neo. In reality, while the Western aircraft has sold in the thousands, only around 16 C919's are flying commercially. All are operating domestically in China, such as the three that Air China says it owned at the end of last year, less than 1% of its 930-strong fleet.

Since its maiden flight in 2017 and the first with passengers aboard almost two years ago, Comac says the C919 has carried over one million passengers. But even in China the C919 is plying only limited routes, last month beginning service to a 10th Chinese city. Major carriers such as China Eastern and China Southern have slotted it into only 12 and six routes, respectively.

Comac has marketed the C919 internationally, such as at an air show in Singapore last year, but hasn't announced foreign deliveries. Comac initially planned to win Federal Aviation Administration certification, the industry gold standard, by the time it was in service, but so far its primary approvals are in China.

The West remains dominant in the sector. "Unlike many other industries, the commercial aerospace industry did not become dependent on low-cost manufacturing in China," Bank of America analyst Ronald J. Epstein said in a report this week that cast doubt on the idea Beijing could hold the line very long against Boeing. He also wrote: "If China stops buying aircraft components from the U.S., the C919 program is halted or dead."

For a 2020 report on the C919, Center for Strategic and International Studies senior adviser Scott Kennedy noted that of the 82 primary suppliers for the C919 only 14 were Chinese and half of those were foreign joint ventures. Kennedy said while China has more domestic suppliers now, "it's still a plane that depends on Western technologies."

The C919 is powered by Leap engines from a GE Aerospace joint venture with France's Safran Group, cockpit systems from Honeywell International and various technologies from businesses in RTX's Collins Aerospace group.

From the start of C919 development, China's government demanded that much of the Western technology be transferred into domestic joint ventures to put it beyond the reach of foreign governments -- with an eye toward future-proofing against possible export controls. But key components, such as the engines, are imported and even if Comac had domestic supplier options, swapping out major systems would set back the certification process, possibly by years.

GE Aerospace said it abides by all applicable laws and export controls. Honeywell and RTX didn't immediately respond to questions about how the trade war might affect their relationship with Comac.

There is little doubt Beijing is leaning on its domestic airlines to buy Comac planes instead of Western alternatives, but analysts don't see its offerings much threatening Boeing and Airbus now.

The question is, where might Comac be in the future? Supported by the government's deep pockets and deeper determination to advance technologically, Chinese industry has repeatedly encroached on sectors Western companies viewed as beyond its capabilities -- from Huawei telecommunications equipment to DeepSeek artificial intelligence to BYD electric vehicles.

Witnessing how China's carmakers "muscled their way into countries around the world" makes Michigan Gov. Gretchen Whitmer nervous about Comac, she indicated in a speech this month. "They are on the verge of challenging Boeing and Airbus as a serious competitor," Whitmer said. "This should be a wake-up call."

Asked about Comac this month in an appearance before a Senate committee, Boeing CEO Kelly Ortberg appeared to play down the challenge. "Senator, Comac is a competitor. We also have a much bigger competitor in Europe that we compete with on a regular basis in all of our markets," Ortberg said.

Comac intends to use the C919 as a starting point for future aircraft, and U.S. policymakers have grown increasingly uneasy about the Chinese group.

Both the Biden administration and Trump's first administration linked Comac to China's military. They cited Beijing's strategy to fuse civilian engineering with the defense sector to support modernization of the People's Liberation Army but didn't impose export controls that would affect Comac.

Kennedy said the U.S. might not have taken more substantial steps to block American technology from Comac because of the potential impact on U.S. suppliers and because the C919 has few direct defense capabilities, aside from its possible conversion into a military cargo jet.

"The C919 is not the tip of the spear in terms of Chinese aircraft capabilities," he said.

Write to James T. Areddy at James.Areddy@wsj.com

(END) Dow Jones Newswires

April 17, 2025 23:00 ET (03:00 GMT)

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