Boeing plans to remarket some 737 MAX jets earmarked for Chinese airlines

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WASHINGTON/CHICAGO (Reuters) – Boeing (NYSE:BA) will begin to remarket some 737 MAX jets earmarked for Chinese customers, as it cannot wait indefinitely while political tensions between the United States and China snarl deliveries, the company’s top executives said on Thursday.

Chief Executive Dave Calhoun and Chief Financial Officer Brian West discussed the need to remarket some of the planes at separate events.

“We have deferred decisions on those planes for a long time. We can’t defer that decision forever. So we will begin to remarket some of those airplanes,” West said at a Morgan Stanley (NYSE:MS) conference.

Calhoun, speaking to reporters on the sidelines of an aviation event in Washington, expressed pessimism about resuming deliveries in China.

On the need to remarket some jets, he said, “We’ll do it in a very slow way because I want to protect our customers in China but you can’t wait forever. You’ve got to move them and there is a big market.”

Boeing shares were up 1.8% on the news.

Boeing said in July that it had about 290 undelivered airplanes and about half were designated for Chinese customers

The Biden administration has criticized China for preventing Boeing purchases. U.S. Commerce Secretary Gina Raimondo said last year that the Chinese government was preventing its domestic airlines from buying “tens of billions of dollars” of Boeing airplanes.

Calhoun said resuming deliveries in China was critical to Boeing’s future, but said the outlook for selling planes to China in the “near term … a year or two” was negative.

But he said, “I do think we’ll get back there some day, I just don’t think it’s a date soon.” He said he thinks the Biden administration wants to help.

Calhoun said he did not see aircraft demand slowing. “It’s pretty robust.”