Boeing Inches Closer To Sealing 500 Plane Deal With China: Report

Boeing Co. (BA) is reportedly inching closer to sealing a deal with China to sell up to 500 aircraft following years of negotiations.

According to a Bloomberg report that cited people familiar with the matter, Boeing and China are still discussing the finer details of the deal, including the types and quantities of the jets, as well as the delivery timelines.

Boeing’s shares were up nearly 2% during Thursday's pre-market trade. Retail sentiment on Stocktwits around the company trended in the ‘bearish’ territory.

The report added that Boeing’s China deal hinges on the outcome of the Trump administration’s trade talks with the Xi Jinping-led Chinese government. If trade talks fail, the Boeing deal could also fail to take off, but the negotiations have reportedly been years in the making.

Chinese government officials are already reaching out to domestic carriers to check how many Boeing aircraft they would need, according to the report. If China and Boeing end up striking the deal, it would be similar in quantum to an unannounced agreement struck with rival Airbus SE (EADSY).

This would also end a nearly eight-year-long drought for Boeing as far as orders from China are concerned–the aerospace giant’s last Chinese deal was announced in November 2017, during President Trump’s visit to China during his first term. The deal was valued at $37 billion and involved the sale of 300 aircraft.

In May this year, Boeing and Qatar Airways signed a deal for 160 widebody jets, with an option to buy 50 more, along with GE Aerospace (GE) engines, during President Trump’s visit to the Middle East. The deal was valued at nearly $96 billion.

BA stock is up 27% year-to-date and 30% over the past 12 months.

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