AerCap CEO Aengus Kelly said Boeing has been making strides in its improvement plan, though tariffs may threaten the OEM's market share, in an interview with CNBC on March 12, 2025.
“We have seen a marked improvement in the quality, reliability, and safety of the product,” said Kelly.
He added that the company has made “tremendous steps” over the past year since the Flight 1282 incident onboard an Alaska Airlines 737 MAX. The incident resulted in a 38 per month production cap on its 737 MAX aircraft from the Federal Aviation Administration (FAA). Boeing said it expects to raise the cap to 42 per month later in the year with subsequent uplifts to follow. A person familiar with the matter said that once the first cap is lifted, the subsequent lifts will be secured much more swiftly.
“We see [the improvements] because we're on the shop floor buying airplanes,” Kelly continued. “They're better now than they were and are continuing to improve.”
Fitch Ratings similarly said the company is continuing to “stabilise”. The rating agency said the company is “broadly on track” to reach its production milestones.
“Fitch views Boeing’s operational execution, profitability improvement, and balance sheet management as the main drivers for its rating over the next two years,” the agency said.
Boeing set off the year to a strong start, switching the tide compared to the start of 2024. The US OEM delivered 89 aircraft in the first two months of 2025, compared to 54 deliveries in the same period a year prior. Of those 89 deliveries, 71 were 737 MAX aircraft.
Fitch added that trade tensions such as Trump's 25% tariffs on imported aluminium and steel, as well as escalating geopolitical tensions are a risk to the company.
Kelly said: “In an absolute worse case scenario, a 25% increase across the board on tariffs… a Boeing 787 will up by $40 million. No one is going to pay that and it won't happen. The customer won't take it and can't afford the airplane so they call Airbus. In a worst case scenario over time, Boeing would end up with the United States about 20-25% of the global market. Airbus would end up with the rest of the world about 75-80% of the global market because no one can afford to pay those numbers.”
“The key thing for Boeing is a relationship with the FAA that enables them to certify the aircraft they're building today — the MAX 8 — but also the MAX 7, the MAX 10 and the 777-8,” Kelly said.
He added: “If they don't get a working relationship with the FAA to deliver and certify their new aircraft types, you will be handing more and more of the market over to Airbus.”
Boeing has so far managed to outpace its European commercial aircraft assembler rival this year, with Airbus delivering 65 aircraft total for January and February.
Kelly's interview was held ahead of his presentation at the JP Morgan Industrials Conference. With the current environment, AerCap doesn't expect to participate in industry consolidation, according to JP Morgan analysts Jamie Baker, James Kirby, Mark Streeter, and Tyler Schachner.
Kelly added that China's market size should also be considered for future global aircraft demand with Chinese manufacturer COMAC.
“Recently China has shifted to a bias of buying in-China, but [Kelly] believes there is desire to have a dual OEM fleet back, as a third viable competitor to Boeing and Airbus is a decade plus away," the analysts said.