In an article by Eric M Johnson and Tim Hepher of Reuters, Boeing’s Chief Executive Dennis Muilenurg said he is concerned about tariff talks and higher prices in the supply chain. (the author recently bought a hot water heater and prices had gone up because of possible tariffs)  At the end of July, Boeing had not seen any impact with US-Chinese trade.

The supply chain is where the parts of the aircraft are made. The final assembly plants are in  Washington State and South Carolina and maybe China. The parts come from around the world.

Mr. Muilenburg said Aerospace thrives on global trade, free and open trade. Boeing is one of the US biggest contributor to balance of payments, selling planes around the world creating thousands of jobs. Mr. Muilenburg spoke at Britian’s Farnborough Air Show which is an airshow which many purchases of planes signings are announced.

Boeing is in the midst of creating a new plane and has a target date of 2025. The plane would be more economical to run than existing planes. In the airplane world, there are airliners flying 757 and 767 fleets and they are beginning to need replacement.

Linking to dividend paying stocks, as a leading aircraft manufacturer, Boeing has to look into the future to determine what planes will be needed. As India and China develop a middle class able to travel by plane, thousands of planes are needed. Trade wars and tariffs ruin short term planning. Similar to large manufacturers based in the US, while the main product may be finished in the US, most of the parts come from somewhere else. Politicians or at least the President may feel trade wars are winnable, but if China decided to buy more from Airbus, then no matter how great Boeings are, fewer planes would be sold.

There are more questions than answers, till the next time – to raising questions.