Boeing will lose $20 billion because of Trump's Iran decision

(Image credit: Getty Images)

published 9 May 2018

President Trump's high-stakes decision to withdraw the U.S. from the multilateral Iran nuclear deal has winners and losers, and leaves serious questions about what happens next, but one clear loser is Boeing. After the U.S. and Iran signed the deal with China, Russia, and European allies in 2015, Boeing signed a $17 billion deal with Iran Air to deliver 80 aircraft and another $3 billion deal with Iran's Aseman Airlines. Airbus also inked a deal to sell Iran Air 100 planes for $19 billion, only three of which have been delivered. "The Boeing and Airbus licenses will be revoked," Treasury Secretary Steven Mnuchin said Tuesday. "The existing licenses will be revoked."

"We will consult with the U.S. government on next steps," Boeing vice president Gordon Johndroe said in a statement. "As we have throughout this process, we'll continue to follow the U.S. government's lead." Boeing stock fell a modest 0.6 percent on the sanctions news, in part because Boeing already has a long backlog of orders pending, The Washington Post reports.

Trump's decision immediately snaps back sanctions on Iran, prohibiting new deals with Iran and giving companies 90 days to wind down contracts involving airplanes and airplane parts, gold and other metals, U.S. dollar transactions, or auto deals, and 180 days to stop buying Iranian oil or conduct business with Iran's insurance and shipping sectors. "These sanctions do impact all of the major industries," Mnuchin said. "These are very, very strong sanctions; they worked last time. That's why Iran came to the table." He didn't explain why Iran would return to the table after the U.S. broke its word.

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Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.