Aircraft orders plummet amid US tariff uncertainty
Commercial aircraft orders plummeted last month as Donald Trump’s tariffs piled pressure on the aerospace industry.
There were 19 aircraft orders in April, a 75 per cent year-on-year decline and the lowest for the month since the pandemic.
The latest data from ADS, the UK trade association, is the first reported since the introduction of tariffs on US imports of aircraft.
Deliveries rose 20 per cent of the month to 102 as the aircraft backlog reached 15,871, equivalent to around £248bn in value to the economy.
“The uncertainty caused by tariffs likely continues to delay order decisions, while aircraft manufacturers have begun to re-allocate aircraft to avoid immediate repercussions of new custom duties,” Aimie Stone, chief economist at ADS, said.
Trump’s liberation day announcement upended a sector that has operated free from trade barriers for the best part of the last 40 years.
ADS has refrained from giving forward-looking forecasts for the year until at least June due to the uncertainty.
‘Further clarity’ needed on aerospace tariffs
It was revealed as part of the UK-US trade agreement that some engine and plane parts would receive an exemption from tariffs. However, the exact details were not made overtly clear in the aftermath of the announcement.
Stone called for “further clarity” from the UK government on the exclusion of engines and aerospace components in the levies.
“Doing so would support UK competitiveness in the global aerospace market and restore some momentum seen in the first quarter.”
In a statement, ADS said: “While the recent UK-US bilateral trade deal is expected to lead to an exemption for US-inbound aerospace parts, the movement of goods will still be slowed down by customs activity, and rising costs from increased paperwork and material costs due to the
international nature of aerospace supply chains will continue to hamper growth.”
There is also an ongoing dispute between airlines and aircraft manufacturers over who should front the costs of any additional tariffs.
Airbus has told its US-based customers that it will not cover the fee, however airlines have been equally as hard line in their response.