The head of the world’s largest aircraft leasing company, AerCap (AER.N), said on Monday that potential new trade tariffs floated by U.S. President-elect Donald Trump could hit supply chains and hinder efforts by Boeing (BA.N) to generate much-needed cash.
The biggest priority for Boeing and U.S. regulators should be to streamline certification of the 737 MAX 7 and 737 MAX 10 jets as well as the long-delayed 777X, CEO Aengus Kelly told Reuters in an exclusive interview on the sidelines of the Airline Economics conference.
"We'll have to wait and see...what's in the detail. A lot of parts that are supplied to Boeing, Airbus and Embraer aircraft are common," Kelly said.
"What would you do with an engine that's partly made in France? Are you going to put a tariff of 20% on that engine? Is that counterproductive?". Boeing's largest engine supplier is CFM, owned by GE Aerospace (GE.N) and France's Safran (SAF.PA).
"Boeing needs cash. It has to convert inventory into cash. Tariffs don't help that," Kelly said. "How do you get cash? You deliver airplanes. To deliver an airplane, it must be certified. If it's not certified, there's no chance of getting cash. That is what I would say should be the number one focus."
Boeing was not immediately available to comment outside of U.S. business hours.
Speaking as AerCap celebrates the 50th anniversary of aircraft leasing in Ireland, Kelly also said he believed a shortage of supply of jets and parts would last for "years" in the wake of several years of underproduction following COVID-19.
