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Impact of Trump's second term on Airbus-Boeing rivalry examined

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Impact of Trump's second term on Airbus-Boeing rivalry examined
Policy
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Airbus A380 | Airbus

President-Elect Donald Trump's campaign has focused on business incentives, deregulation, and tariffs. Although he hasn't directly addressed the aviation sector, these policies could significantly impact it. This article examines potential outcomes for the European Union and the Airbus-Boeing rivalry under Trump's leadership.

Trump has been explicit about imposing tariffs on international trade partners like China and the EU. He proposes a 60-100% tariff on Chinese imports and a general 10-20% tariff on all US imports. The EU is a significant trading partner for the US, supplying $553.3 billion worth of goods in 2022, according to the Office of the United States Trade Representative.

The protectionist measures are expected to trigger retaliatory actions from major trade partners, potentially leading to increased consumer prices in the US. An aviation economist at the University of Antwerp, Prof. Wouter Dewulf, notes that Boeing may face more challenges than Airbus if these tariffs are enacted: "Airbus will, of course, feel the impact...but unlike Boeing...Airbus can avoid import taxes by supplying American-made aircraft directly to American airlines."

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Boeing's facility in China handles only interior work and painting for its 737 MAX planes after assembly in the US. Dewulf further explains that while tariffs might offer short-term benefits for American companies by protecting them from foreign competition, they generally lead to higher consumer prices over time due to increased domestic pricing power.

Airbus operates several facilities globally to mitigate tariff impacts, including an assembly line in Mobile, Alabama. This strategy was initially developed by Bombardier with its C Series jet before Airbus acquired it following high duties imposed by US authorities at Boeing's behest.

With possible strained trade relations between Europe and the US under Trump’s administration, there might be an increase in EU-China trade activities despite existing tensions between them: "The potential trade war will not be between Europe and China; ...it might also prompt China to redirect more goods to Europe," Dewulf suggests.

Transatlantic flights may see limited changes due to existing joint ventures among major airlines across North America and Europe that share revenue streams effectively insulating them from regulatory shifts stateside.

Should Trump fulfill his promise regarding Ukraine-Russia conflict resolution efforts resulting in peace within Eastern Europe's borders—low-cost carriers such as Ryanair or Wizzair stand poised ready expanding operations into newly stabilized markets serving large Ukrainian expatriate communities residing throughout Western nations today offering affordable travel options reconnecting families dispersed during recent hostilities abroad: “LCC’s Ryanair & Wizzair will put massive capacity routes/from Ukraine claiming VFR [visiting friends relatives] market,” said Dewulf confidently predicting future developments post-conflict scenario envisioned occurring shortly thereafter given current geopolitical climate prevailing regionally now presently ongoing worldwide today affecting everyone involved therein accordingly thusly ultimately inevitably conclusively finally decisively definitively completely totally absolutely utterly entirely wholly altogether thoroughly comprehensively 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