By Katherine Hamilton

Boeing shares regained most of their morning loss as investors weighed the impact of China cutting off new orders for the manufacturer's jets.

The stock recovered most of its nearly 4% fall on Tuesday morning, landing down around 0.3% at $158.72 by midday. The stock has lost 11% of its value this year.

Beijing told Chinese airlines not to place new orders with Boeing and to seek approval before taking delivery of aircraft they have already ordered. The loss of deliveries to China could lower revenue for the jet maker, which is the largest exporter in the U.S., but the size of that dent is still unclear, analysts say.

"It's not like this is an immediate impact," Benchmark analyst Josh Sullivan said. "If it lasts and turns into China canceling actual orders, it would have an impact."

Aircraft and parts are currently in tight supply globally which could limit the short-term effect of the latest halt, Sullivan said. Boeing's new original equipment management slots are also sold out late into the decade, he said. Its backlog comprises about $500 billion, J.P. Morgan analysts say, though it is also trying to offload many almost-completed planes it has parked.

Over the past five years, China has already cut Boeing deliveries by 84% compared with the five years before, The Wall Street Journal reported. The company restarted sending planes to the country this past summer after China previously halted Boeing deliveries following two crashes in 2018 and 2019.

Sullivan said aircraft trade is being used as political football during tariff negotiations, but if the order remains, it could start to hurt the jet maker. Boeing planes earmarked for future delivery to China would amount to a $1.2 billion cash drain if the orders are cancelled, Bernstein Research estimated. The manufacturer can try to redirect those planes to other buyers, but many airlines in the U.S. are also cutting back on supply as air-travel demand falls.

Airlines including Delta, United and Frontier have retired aircraft or limited capacity in the past two months as leisure and business travelers are spending less. Melius Research analyst Scott Mikus said more retirements should be expected, which could start to weigh on airplane suppliers.

"It's so important we continue to have access to that market and we don't get in a situation where certain markets become closed to us," Chief Executive Kelly Ortberg said during a Senate hearing earlier this month. Boeing exports about 80% of the commercial airplanes it builds.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

April 15, 2025 12:45 ET (16:45 GMT)

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