Airbus will avoid Trump tariffs by delivering planes to US airlines in countries outside America, its CEO says

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01-05-2025

Airbus's CEO said it's exporting US airlines' planes to other countries to avoid tariffs.
An A350 for Delta Air Lines is scheduled to fly from Toulouse, France, to Tokyo for delivery.
It's the same tactic used during a previous trade war between the EU and the US.
Airbus is working to avoid Donald Trump's tariff plan by sending planes to US airlines via other countries.
"We're looking at opportunities to export to somewhere else than [the] US, especially for airlines who have international operations, and we have that flexibility," CEO Guillaume Faury said on the company's first-quarter earnings call on Wednesday.
He explained that if Airbus sends parts to its final assembly line in Mobile, Alabama, the planemaker has to pay the 10% tariff. Alternatively, if the plane is built in Europe and then sent to the US, the airline would pay the import fee.
"There's obviously a contradiction that […] actually nobody wants to pay the additional cost," Faury added.
In February, the Airbus boss said that tariff costs would be passed onto airlines, which would, in turn, mean higher ticket prices.
However, Delta Air Lines CEO Ed Bastian said on an earnings call last month that the carrier would not pay any tariffs and instead would defer aircraft deliveries.
Now, it looks like the two parties have found a way around the conundrum.
Flight tracking data shows a new A350-900 for Delta was scheduled to fly Wednesday from Toulouse, France — Airbus' headquarters — to Tokyo's Narita Airport.
This flight was canceled, but a new one was scheduled for Saturday, according to data from FlightAware.
This is the same tactic that was used when Airbus faced tariffs during a previous trade war between the US and the European Union.
"We are doing what we were doing five years ago in a similar situation," Faury said.
The World Trade Organisation had permitted tariffs on aircraft as high as 15% as the two sides accused the other of unfair subsidies for Airbus and Boeing, until a truce was struck in 2021.
At the time, Delta decided to use new Airbus planes exclusively for international flights, which meant they were never officially imported, as an airline spokesperson told Simple Flying in 2019.
On Wednesday's earnings call, Faury called for a return to zero tariffs on all civil aerospace parts and airplanes.
Airline stocks have reacted with particular volatility to tariff announcements. Travel is often one of the first things people cut back on during economic uncertainty.
Several airlines withdrew their financial forecasts as they announced first-quarter earnings last month.
Airbus kept its outlook in place, which excludes tariffs, owing to the uncertainty around the situation.
Its first-quarter net income rose by a third to 793 million euros ($898 million), beating expectations, and its share price jumped 2%.
Read the original article on Business Insider