Amid an escalating trade war driven by Donald Trump, Boeing (BA), a major player in the Dow Jones, has suffered significant losses, while its European rival Airbus (EADSY) has experienced a surge. Trump’s tariffs are expected to raise costs for Boeing and could make the company a prime target for retaliation by other nations.
In March, Boeing stock has plunged 11.7%, reaching its lowest levels since November 2024. On the other hand, Airbus stock has soared 9.1%, hitting a record high. Brazil’s Embraer (ERJ) also saw a notable increase of 7.1% last week, following a 15.5% surge the previous week, driven by strong earnings.
Trump’s tariff policies include 25% duties on Canadian and Mexican goods, although many items are exempt until April 2. Additionally, he has increased tariffs on Chinese goods by 20%, and plans to impose similar tariffs on steel, aluminum, and other key commodities. These tariffs are expected to significantly raise the costs of essential parts for Boeing, according to CEO Kelly Ortberg, who explained the situation in a gathering with employees, as reported by Bloomberg.
Boeing relies on global supply chains, importing key parts from Canada, Mexico, and China, and its operations in Winnipeg, Canada, could be affected by these new tariffs. Ortberg emphasized that disruptions in the global supply chain could become an expensive challenge for Boeing, making it difficult to complete production without the necessary components.
While Boeing may try to source more parts domestically over time, the steel and aluminum duties will still pose a burden. Boeing is also facing issues with some domestic suppliers, such as Spirit Aerosystems (SPR), which has experienced recurring problems, prompting Boeing to take over the company.
In contrast, Airbus largely manufactures jets in the U.S., although it does have some assembly operations in Alabama, which insulates it to some extent from the impact of the tariffs.
The global implications of the tariffs could further harm Boeing, particularly as other countries—especially in Europe and China—may retaliate by imposing their own tariffs on Boeing jets. Additionally, foreign airlines might choose to refrain from ordering Boeing aircraft, avoiding exposure to the tariffs.
Boeing has been struggling for several years due to a series of setbacks and mishaps, and the latest tariff-related challenges are adding more pressure on the company. Meanwhile, European markets, boosted by stimulus plans, have outperformed U.S. markets, with Airbus benefiting from these global dynamics. As a result, Boeing appears to be one of the most prominent losers of Trump’s tariff strategy.
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