The price of a Boeing (NYSE:BA) 787 plane could increase by $40 million in a worst case tariff scenario, AerCap (NYSE:AER) CEO Aengus Kelly said.
“In an absolute worst case scenario, say, a 25% increase across the board on tariffs, a tit-for-tat from both sides — a Boeing 787, the price will go up by $40 million,” Kelly said Wednesday.” “No one’s going to want to pay that.”
In that kind of scenario, Kelly said most airlines would instead likely turn to Airbus, which could give that company an opportunity to take 75% to 80% of the global market.
AerCap, the world’s largest aircraft leasing company, bought 150 aircraft, helicopters and spare engines last year from Boeing, Kelly added.
Though it’s too early to determine exact impacts of rising tariff tensions, the global economy has been reacting to President Donald Trump’s plans, with the latest addition of 25% tariffs on steel and aluminum imports coming into effect Wednesday, resulting in swift counter-measures from the European Union.
Despite a chaotic year of troubles for Boeing, Kelly said Aercap, which is the biggest buyer of aviation assets in the world, has seen a recent improvement in the quality, reliability and safety of products out of Boeing.
BA shares gained altitude $1.13 per share to $155.39, while those for AER inched up seven cents to $97.19.
