China, Boeing Deny Suspending Airplane Deal

BEIJING – A spokesman for China's airline regulator and a representative from Boeing denied a report Tuesday that the country has suspended a $1 billion purchase of Boeing jetliners because of the collision of a U.S. Navy surveillance plane and a Chinese fighter jet.

The Asian Wall Street Journal said China had put off buying at least 30 Boeing 737 New Generation planes for several carriers.

Boeing spokeswoman Ivy Takahashi said the orders appeared to be on track for the normal approval process.

"We were given no indication this pending order or future pending orders should be directly impacted by the current political situation," said Takahashi, who is based in Seattle.

Spokesmen for the Chinese regulator, the Civil Aviation Administration of China, and the country's three biggest commercial carriers -- Air China, China Eastern and China Southern -- said they had heard of no such decision.

Ma Songwei, a CAAC spokesman, said he had asked other Chinese officials about the Journal report and none had heard of such a postponement.

The Journal cited an unnamed executive of a Western aircraft-leasing firm who said the deal had been put off because of the April 1 collision, which killed the Chinese fighter pilot and threatened to sour U.S.-China relations. Chinese airliners were scrambling to line up leased aircraft to make up for the lost capacity, the report said.

Major foreign purchases by China frequently involve lengthy and complex negotiations and can be affected by politics.

Takahashi conceded that the process of selling a plane to China can be complex, but said the company tries not to let politics further muddle negotiations.

"We've worked with the Chinese for 30 years now," Takahashi said. "We try very hard to not conduct conversations along political issues. We are business partners."

Beijing has on occasion revoked deals to punish governments for dealings with rival Taiwan or other actions. The signing of contracts to buy jetliners and other big-ticket items is sometimes timed to coincide with meetings with foreign leaders.

Aircraft makers regard China as one of the world's most promising markets, but turmoil in the industry has made sales prospects uncertain.

Chinese airlines suffer from a glut of overcapacity that threatened several with bankruptcy. They are under government pressure to improve their competitiveness through a series of mergers, which would cut the number of potential aircraft buyers.

Boeing signed contracts last year to sell Chinese carriers nine jetliners, and this year sold two 747-400 jumbo jet freighters to China Southern, according to Hooper. The list price for the freighters starts at $185.5 million.