Prepare to counter! If negotiations with the U.S. fail, the EU will impose tariffs on Boeing aircraft

The EU is preparing to include Boeing aircraft in its countermeasure list against the US as a response plan following failed negotiations with the US.

According to CCTV News, Trump announced on April 2 local time that a 10% "baseline tariff" would be imposed on all countries, effective at 12:01 AM Eastern Time on April 5. On April 7, CCTV reported that Trump is considering suspending tariffs for 90 days on certain countries. However, the 25% tariffs on EU steel, aluminum, and automobiles remain in effect.

According to a report by the Financial Times on May 7, the European Commission—responsible for EU trade policy—will include civil aircraft in its target list for approximately €100 billion of annual imports from the US.

The report cites informed sources stating that these measures will only take effect if the EU fails to achieve sufficient progress in negotiations with the US by July 14 and must first receive weighted majority approval from member states. The target list is expected to be announced this Thursday, but changes may still occur.

The aviation industry is eager to adapt to Trump's trade policies, with higher costs already beginning to transmit through the supply chain. Both Airbus and Boeing import new aircraft parts from different regions. Boeing sources some aircraft parts from Italy and Japan and is already facing higher import costs.

US-EU Trade Tensions Escalate

To facilitate the negotiation process, the EU has suspended retaliatory tariffs on US goods worth €21 billion (including Harley-Davidson motorcycles, poultry, and clothing) until July 14. If no agreement is reached by then, the next wave of tariffs, including on aircraft and possibly chemical products, is likely to take effect simultaneously.

EU Trade Commissioner Maroš Šefčovič stated to the European Parliament on Tuesday that currently, 70% of EU exports to the US are subject to tariffs. If the US continues to impose sector tariffs on pharmaceuticals, semiconductors, and other products, this proportion will rise to 97%, affecting €549 billion worth of goods. Based on current trade volumes, the US will impose tariffs exceeding €100 billion annually.

"We now need the US to indicate its willingness to make progress towards a fair and balanced solution," he said:

"We are fully committed to discussions with the US, as negotiating a solution remains our clear and preferred outcome. But if our negotiations with the US do not yield the necessary results, we will be ready with alternatives aimed at restoring a fair competitive environment; 'all options are on the table.'"

Aviation Industry Faces Impact: Global Supply Chains Disrupted

Several airline executives have warned in recent weeks that they would rather delay deliveries of Boeing or Airbus aircraft than pay tariffs. Ryanair CEO Michael O'Leary told the Financial Times last month that if aircraft become more expensive due to tariffs, the airline will delay deliveries The export of aerospace and defense products from the United States is significantly higher than the import volume. According to data from the industry trade association Aerospace Industries Association, U.S. global exports of aerospace and defense products approached $136 billion in 2023. The total value of U.S. aerospace and defense imports was slightly below $22 billion.

Airbus CEO Guillaume Faury stated at an event in Paris on Tuesday that he expects Europe to implement "reciprocal" tariffs on aircraft, similar to what was done during the subsidy dispute five years ago. The U.S. and the European Union suspended these tariffs in 2021.

Faury added that the company is facing a "lose-lose" situation:

"This is really detrimental for both Europeans and Americans, but primarily detrimental for Americans. That’s why I hope that over time, things will be resolved. But that’s not the case at the moment. We have a high-performance transatlantic ecosystem, and these tariffs will harm it."