Boeing and Airbus will lose contracts worth roughly $39 billion to replenish Iran’s aging fleet of commercial planes as part of the Trump administration’s reimposition of sanctions.
“The Boeing and Airbus licenses will be revoked,” Treasury Secretary Steven Mnuchin told a group of reporters Tuesday. “The existing licenses will be revoked.”
The aircraft sales were among the most sought-after contracts for Iran.
In December 2016, Airbus signed a deal to supply national carrier Iran Air with 100 airplanes for around $19 billion at list prices. It has delivered three planes so far, the first new aircraft acquired by Iran in 23 years.
Boeing later inked a deal with Iran Air for 80 aircraft with a list price of about $17 billion, promising that deliveries would begin in 2017 and run until 2025.
(1) There are a load of US-made components in any Airbus. Most of the planes are European-made, but it’s a global supply chain and that includes parts from the US. In some of the really big obvious cases, like engines, there would be non-US options, but there is a load of other smaller US-supplied stuff that goes into them.
(2) The Trump administration has explicitly said that these sanctions will apply to European businesses. European businesses will not be allowed to do deals with Iran, or they will also face US sanctions. Airbus has a much larger market and business in the US than it does in Iran, and won’t want to jeopardise that, it even has a huge factory in Alabama so it can make complete planes on US soil.