UP IN THE AIR

If Trump pulls out of the Iran nuclear deal it could sink $32 billion in airline sales

Obsession
"America First"
Obsession
"America First"

Sometimes Donald Trump likes to pretend to be coy. Asked by reporters today about the multilateral 2015 deal that lifted sanctions on Iran in exchange for its agreeing to never seek nuclear weapons, the US president said three times “I have decided” whether or not to pull the US out of the deal. What did he decide? He wouldn’t say.

However, judging from how he described the Iran deal in his UN speech on Sept. 19—”one of the worst and most one-sided transactions the United States has ever entered into” and an “embarrassment”—and things he has said before, Trump has decided to leave. (It wouldn’t be the first time he trailed a decision days ahead of announcing it.)

The deal, which took years to negotiate and ended nearly four decades of tense relations between Iran and the West, gave global energy and aerospace companies access to the untapped market of oil-rich Iran and its 80 million people. US oil firms mostly stayed on the sidelines while European and Chinese firms went in, but both of the world’s big aircraft manufacturers, Boeing and Airbus, struck a flurry of deals in Iran as the country began replacing a fleet that dates back to the 1970s.

  • December 11, 2016: Boeing and Iran Air announced a sale of 80 commercial aircraft for $16.6 billion. At the time, Boeing said the deal could support 100,000 US aerospace jobs.
  • December 22, 2016: Airbus signed a deal to sell Iran Air 100 commercial aircraft, for about $10 billion.
  • April 4, 2017: Boeing agreed to supply 30 737s to Iran Aseman airlines for $3 billion.
  • June 22, 2017: Two Iranian airlines agreed to buy 73 more Airbus planes in a deal worth an estimated $2.5 billion.

Boeing and Airbus are still required to get a license from the US Treasury’s Office of Foreign Assets Control (OFAC) before they formalize any aircraft sale to Iran—Boeing because the company is based in the US, and Airbus because it relies on so many US suppliers to make its planes. If Trump decides the US should leave the Iran deal outright, OFAC could rescind those licenses, industry executives told Quartz.

And it’s not only Boeing and Airbus that stand to lose billions of dollars in sales: So do companies like General Electric, which is supplying the engines for the Boeing orders.

The Treasury didn’t respond to a request for comment. “Boeing and Iran Air continue to work on implementing the sales contract for commercial passenger airplanes signed in December 2016,” a Boeing spokesman said. “We continue to follow the lead of the US government in all our dealings with approved Iranian airlines.”

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