In the midst of trade upheaval, Boeing's customers in China have "indicated that they will not take delivery" on up to 50 planes that were earmarked for the Chinese market this year, according to the US aerospace giant's CEO.
And the situation in China "will take away some of the headroom we've built with our strong first-quarter deliveries", Kelly Ortberg said during Boeing's latest earnings call.
The executive's acknowledgement this week of trouble in China shows that the heightened trade war between the two great powers will accelerate Boeing's steep decline in the Chinese market after years of struggle, according to analysts.
They also said that the US-China tariff tiff would simultaneously burden China's home-grown aircraft maker.
With China's retaliatory tariffs on American imports considered cost-prohibitive, Chinese airlines would pay unprecedented prices for Boeing planes shipped from the United States.
And Chinese airliners will face higher maintenance costs for their Boeing fleets in service, the analysts added.
Meanwhile, the state-run Commercial Aircraft Corporation of China (Comac) would pay the tariffs on parts it normally gets from the US, such as engines made by General Electric or Pratt & Whitney, analysts said.
Comac builds the regional C909 and narrowbody C919 aircraft, which are flown mostly within China.
"China is a major importer of Boeing passenger jet aircraft, as well as of US-manufactured aircraft parts for its commercial aviation industry," said Rajiv Biswas, CEO of Singapore-based research company Asia-Pacific Economics.
US President Donald Trump has imposed tariffs totalling 145% on Chinese imports so far this year, bringing the effective tariff rate to about 156%.
According to a fact sheet released by the White House, China now faces tariffs of up to 245% - a figure that includes tariffs predating the second Trump administration. Meanwhile, Beijing's new levies on US goods have risen to 125%, also on top of earlier-imposed tariffs.
"China's commercial aviation industry faces tremendous disruption unless an exemption from China's 125% tariffs on US imports is given by the Chinese government for US commercial aircraft and parts imports," Biswas said.
Two Boeing jets set for use by a Chinese airline have been returned to the US since Sunday - apparent fallout from the worsening trade dispute, Reuters reported, citing flight data.
Boeing, which did not answer a request for comment, last year called China a "significant market". Comac also did not respond to requests for comment.
The Boeing chief executive said on Wednesday that his company was "assessing options for remarketing already-built or in-process airplanes" originally made for Chinese customers. An aircraft for one airline can often be transferred to another as long as the fuselage shows the new owner's brand name.
"We've bounded our exposure, and until we get more clarity, we're going to do our best to keep the China situation from impacting our production flow," Ortberg said, adding that if US tariff impacts expand beyond China, "we would expect to see additional pressure".
Boeing orders from China began slowing down, and eventually halted, amid trade tensions during the first Trump administration, Goldman Sachs said in an April 16 research note. And as of March, the note said, 130 of Boeing's 6,319 unfilled commercial plane orders were slated for China.
Chinese airlines would pay "billions in revenue" if they kept buying Boeing jets under current tariffs, said Zhang Wendong, an assistant professor in applied economics and management at Cornell University.
China's Comac, which aims to compete with the global Boeing and Airbus duopoly, is trying to source more parts domestically but lacks those components for now, analysts said. Its C919 began flying commercially about two years ago.
"Comac, while insulated from direct sales tariffs as a domestic manufacturer, relies on US components subject to China's 125% tariffs … threatening C919 production timelines," Zhang said.
The C919 relies on American and other Western suppliers for 90% of its components, including CFM LEAP engines and Honeywell avionics, Zhang said. Full domestic sourcing of parts for the C909 or C919 is unlikely to happen before 2035, he said.
Boeing need not pay tariffs for made-in-China parts used to make planes in US-based "foreign trade zones" and sold outside the US, Li said.
An estimated 10,000 Boeing commercial jets use components from China, a Boeing press release said in August.
Li said that Comac aircraft parts from the US, if used to make planes for export, would also avoid tariffs.
US Treasury Secretary Scott Bessent hinted at a de-escalation of the trade war with China during a private investor summit on Tuesday.
But for now, with tariffs likely to elevate costs for Comac and Boeing, Airbus may pick up some of the slack through its assembly line in the northern Chinese city of Tianjin, Zhang said.
For its part, Airbus has faced supply bottlenecks since the pandemic, and the company said on its website that "supply-chain woes are continuing to threaten to slow down the return to business as usual".
China's commercial aircraft fleet will grow 4.1% annually to 9,740 aeroplanes by 2043, Boeing forecast last year.
"The [tariff] move pushes airlines toward Airbus and to Comac's C919, aligning with China's goal to reduce US reliance, though limited production capacity may constrain short-term benefits," Zhang said.