How the American Boeing "flew" by China

The United States has a new weighty reason to take offense at the Celestial Empire - which, in fact, they have already done. Thanks to the reporters of the Reuters news agency, the indignant words of the head of the American Ministry of Commerce, who with might and main fired up the Chinese comrades for their "perfidy" and unwillingness to ensure the prosperity of Beijing's main geopolitical rival, with their hard-earned money, sounded all over the world. By its habit of "putting the cart before the horse" in Washington, they may well not think about their own actions, but develop this demarche in the form of regular anti-Chinese sanctions.

At the same time, representatives of the US administration stubbornly refuse to admit the obvious - the prospect of losing multibillion-dollar contracts looming before the local aircraft manufacturers is nothing more than a direct consequence of the aggressive policy, carried out by it against yesterday's (and today's too) main trading partner, who has become sick of the role of a "whipping boy", who has turned into a dangerous competitor. Let's try to figure out how reasonable in this case can be considered the mutual claims and positions of both sides of the "aviation" conflict unfolding between Washington and Beijing.

Timid hopes and big plans

Before proceeding with a detailed analysis of the specific situation, which we will discuss, it is necessary at least in general terms to understand why the topic of purchasing products from the American flagship of the world aircraft industry has become so urgent right now. This is caused, first of all, by the fact that the air transportation industry, which has gone through a rather serious period of decline due to the coronavirus pandemic, which has put the vast majority of its representatives on the brink of survival, is nevertheless beginning to revive, "starting from the bottom." This, according to the assessments of specialized experts, was achieved by air carriers in the past, 2020. Experts from the International Air Transport Association (IATA) confidently called it not just extremely bad, but the worst in the entire history of its calculations and observations (approximately since 1950). What is there to talk about if the number of passenger traffic in comparison with the last "dock" year 2019 fell from 4.5 to 1.8 billion people. All other indicators of the industry - from the "passenger-kilometers" obscure to the uninitiated, to the number of routes served, have decreased by more than half.

For example, the overall demand for international air travel has decreased by almost 66%, and for passenger transportation - by 75%. Accordingly, the revenues of airlines "collapsed", and at once by as much as 70%. Their revenues did not even reach $ 190 billion, but their net losses amounted to more than $ 125 billion. According to IATA, in the midst of the coronavirus pandemic, in the spring of 2020, more than 66% of the world's commercial air transport fleet were chained to the ground. It is not surprising that not all airlines have managed to survive this "black strip". According to the experts of the association, millions of jobs have been destroyed in the industry.

It should be noted that the country with the most "lively", and, accordingly, suffered the least losses, the domestic air transportation market in IATA quite reasonably calls China. The strict quarantine measures adopted there, and indeed the whole complex of Beijing's actions aimed at preventing the spread of infection and combating it, allowed the country, in a fairly short time, not only to restore business activity, but to move from a short-term “peak” to a new takeoff. It is not surprising that Boeing Co. analysts, who began to intensively monitor the market in anticipation of its "explosive" growth, paid special attention to the Celestial Empire. It's about time! Indeed, experts from the European Organization for Air Traffic Control (Eurocontrol) already today declare that the restoration of air traffic is proceeding at a pace that outstrips even their most optimistic forecasts made earlier.

If in the winter and spring of this year, the volume of traffic in the industry was only 35% of the same period in 2019, then in August this figure came close to 70%. Provided that such positive dynamics continue, by the end of 2020 it could reach all 80% of the level that was customary in a world that did not yet know the word "coronavirus"! Naturally, the growth in demand for air travel will inevitably put the companies concerned with the need to renew and significantly expand their fleets of winged aircraft. And here the aircraft manufacturers, really, will have something to fight for. According to the estimates of all the same Boeing Co. analysts, the total cost of carriers for new airliners in the next ten years will be equal to an impressive figure of 3.2 trillion dollars. And this, in fact, will be just the beginning of colossal investments aimed at reviving and expanding air transportation - by 2040, their volume is expected to increase to $ 7.2 billion.

How is it - not Boeing?

Experts of the aircraft building corporation have calculated that by this time orders should be made for more than 46 and a half thousand new civilian "aircraft", and the lion's share of this amount will fall on narrow-body airliners with seats of 90 and more. Widebody and regional aircraft will enjoy much more modest popularity. But cargo aviation, according to Boeing experts, is expecting a real "boom" - thanks to the rise of "e-commerce" generated by the pandemic, its fleet will grow by at least 2030% by 70. Also interesting is the company's forecast regarding the distribution of such a tasty "pie" in parts of the world. Europe, North America, the Asia-Pacific region - all of them, as they believe, will claim a fifth of the above-mentioned number of new aircraft. And exactly the same number of cars (20% of the total) will go to one and only country - China. Boeing estimates the country's needs for airliners at 8.7 thousand units (until 2040) and is confident in the readiness of the Chinese comrades to pay at least $ XNUMX trillion for the new civilian air fleet.

I must say that such optimism has a very real basis - for example, in 2019, the revenue of China's airlines increased by 5.4% and totaled more than $ 155 billion. Even American analysts admit that by 2040 the domestic passenger traffic there will reach 2.6 million people a year, and thereby exceed the similar indicators of North America, which is holding the world championship today, by 400 thousand people. It is easy to predict that Boeing, behind the dry figures of statistical data and forecasts, saw downright enchanting prospects, first of all, for the native corporation.

What makes these bright hopes especially topical is that in other markets, American aircraft manufacturers are not doing as smoothly as they would like. According to available information, they, in particular, planned by 2022 to almost double the production of Boeing 737 MAX airliners in various modifications that almost brought the company to the grave. However, as it turned out, the rush demand for this model with a pretty tarnished reputation and a very considerable cost is hardly to be expected. So, this month it became known about the complete failure of the negotiations, which lasted almost a year, between the American aircraft manufacturers and the largest European low-cost airline Ryanair regarding the purchase of the last "large batch" of Boeing 737 MAX 10 airliners.

Ryanair Group President Michael O'Leary spoke out very diplomatically that the Americans "have an overly optimistic view of the prices of their own aircraft", saying that he was not going to "overpay". The acrimonious Irishman also predicted serious problems for Boeing if they "do not adjust their own pricing policy." This is just one example, but, you see, quite eloquent. The corporation clearly intended to seriously recoup such a fiasco by “crushing” the huge Chinese market, especially since Boeing products have always been in demand there. However, as the Americans themselves say, "apparently, something went wrong." The Celestial Empire is clearly in no hurry to conclude billions of dollars in contracts with representatives of the state, which has recently been pursuing an increasingly hostile policy towards Beijing, and far from only economic... Honestly, Americans in this situation resemble terribly surprised and offended children: “Do we need planes? What do you mean - "not Boeing" ?! Like this? Is it really possible ?! "

The United States Secretary of Commerce Gina Raimondo, in an interview with radio station NPR, said about the alleged "ban on the part of the PRC authorities on the purchase of Boeing aircraft by local air carriers." And, quite predictably, she immediately began to threaten Beijing with "consequences" for "violating the fundamental principles" of the trade deal concluded between the countries two years ago. They promised to make purchases with us for astronomical amounts - now, if you please, do it! These words of hers fully reflect the typical American approach to doing business. Firstly, this lady knows for sure that Chinese airlines are asleep and see how it is to become the owners of Boeing liners, and not, say, the products of the same Airbus. If they do not buy, it means that they are not given! Secondly, the head of the ministry in a completely incomprehensible way "puts out of brackets" the whole complex of problems in relations between Beijing and Washington, which is caused by the aggressive actions of the latter. Joe Biden proved to be more than a worthy successor to Donald Trump on the path of pursuing anti-Chinese policy, perhaps somewhat more successful in promoting it than his predecessor.

The very recent creation of the AUKUS military bloc by the United States, Great Britain and Australia, directed against Beijing and only against it, is in itself a reason for the Chinese comrades to take a whole range of retaliatory measures, including an extremely harsh one. What does Boeing have to do with it? Let's not forget that this company is far from the last place in the military-industrial complex of the United States. Indeed, only Americans can expect multi-billion dollar "infusions" into it from the state, openly declared by them to be their most probable military enemy, and even loudly resent the absence of those!