Boeing just reported another massive loss. It still might be its best week in more than six years

By Chris Isidore, CNN

(CNN) — Boeing reported yet another massive quarterly loss Wednesday. It could still be an extremely good week to be Boeing.

That’s because the US planemaker could finally get a huge order from Chinese airlines, a market that the company has been frozen out for nearly a decade.

Boeing is reportedly close to reaching a deal that could result in as many as 500 jet orders from Chinese airlines in the coming days or weeks, possibly as soon as President Donald Trump meets with Chinese leader Xi Jinping in South Korea on Thursday, according to multiple outlets.

Deals of this magnitude, which require the approval of the Chinese government and not just the airlines, have often been announced when the leaders of the two counties met face-to-face.

And US Ambassador to China David Purdue told reporters and visiting members of Congress last month that negotiations for a “huge” deal are close to conclusion.

Boeing passenger jet sales to mainland China have ground to a near halt since trade disputes between China and the United States first heated up at the start of the first Trump administration. Boeing has sold only 49 jets to China since 2018, with 14 going to Hong Kong-based Cathay Pacific and virtually all of the the rest made up of freighter aircrafts or sales to Chinese leasing companies, not the airlines themselves.

That’s a small fraction of more than 1,000 Boeing jet sales to Chinese customers in the ten years before 2018.

China is one of the world’s key markets for commercial airline sales given its booming air travel growth. Boeing’s own estimates are that the Chinese fleet of passenger planes is due to double in the next 20 years, with Chinese airlines predicted to buy 9,000 jets.

That’s a market Boeing can’t afford to lose to its perpetual rival, Airbus.

Trump has been happy to trumpet sales of Boeing jets to other countries since returning to office, including from Qatar and Uzbekistan. So disclosing a large order for Chinese planes as a trade deal with China is announced would keep with past practice.

“Clearly the administration and the president are doing a great job with helping us book orders in the market,” Boeing CEO Kelly Ortberg said on CNBC Wednesday morning.

Asked about a possible US-Chinese trade deal, Ortberg said that it’s “important to us.”

“And we’re very hopeful that if we have positive trade negotiations, that will come with some more business with us,” he added.

Some plane orders might not be “new”

Analysts say it’s possible that many of the “new” orders from China were booked by Boeing over the last nine years, but not announced due to trade tensions and the Chinese government trying to put leverage on the US government.

Of the roughly 6,000 jets that Boeing has in its backlog, more than 850 are to “unidentified customers.” More than 600 additional jets have been sold to leasing companies that could be buying them on behalf of Chinese customers.

But even if some of the orders announced as part of the deal were quietly booked already, well over half will likely be new jet orders, Ron Epstein, aerospace analyst for Bank of America, told CNN.

“Caught in the crossfire”

Many of Boeing’s problems can be traced back to the company’s own mistakes, such as two 737 Max crashes tied to a design flaw that killed a total of 346 people.

But Boeing’s problems in China don’t really stem from safety concerns, according to experts.

“It’s 100% politics,” said Richard Aboulafia, managing director of AeroDynamic Advisory.

“This isn’t some sort of internal screw up,” said Epstein. “They’re just caught in the crossfire.”

But even if Boeing announces a mega deal with China is announced, it still has other problems to deal with.

Wednesday it reported a much bigger than expected core operating loss in the third quarter of $5 billion, bringing cumulative losses since the 737 Max grounding in 2019 to $47.2 billion.

Much of that latest loss was due to a $4.9 billion charge due to another delay in the start of deliveries for the 777X, its next generation widebody jet that it now said won’t be ready until 2027.

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