Boeing’s latest announcement puts the Trump administration in the awkward position of choosing between taking a harsher stance against Iran and boosting a major manufacturer, one of the United States’ largest exporters.
The tentative agreement commits Boeing to delivering 30 of its 737 MAX airplanes starting in 2022 and gives the Iranian airline the option of acquiring 30 additional planes. The deal follows a $25 billion Iranian order with France’s Airbus, which competes closely with Boeing for international business.
“Boeing has to be everywhere that Airbus is,” said Loren Thompson, chief operating officer of the nonprofit Lexington Institute, which receives funding from Boeing.
If Aseman Airlines opts for all the extra aircraft, the value of the deal could balloon to nearly $6 billion, and deliveries to Iran could begin in 2019, a Boeing representative said. An Aseman Airlines spokesman told the Associated Press that deliveries would begin in 2019, suggesting the airliner will take advantage of some of the 30 extra planes.
Some analysts have wondered whether the Iranian airlines can afford to buy so many Boeing and Airbus planes. And there is also the uncertainty about whether the Trump administration will clear the Boeing deal. Although the president has pledged to revive U.S. manufacturing, as a candidate he also frequently criticized the Iran nuclear agreement and threatened to renegotiate it. He has yet to take serious steps to do so, but as president he has continued to complain about the terms.
Last month, Trump said on Twitter that the agreement gave Iran a $150 billion “lifeline,” presumably referring to previously held-up Iranian assets that some analysts say are actually closer to $100 billion. When he was still Trump’s national security adviser, Michael Flynn said that Iran was “officially on notice” after it conducted a missile test in February.
Frosty diplomatic relations between Washington and Tehran have already imperiled other U.S. companies’ business in Iran. Last week, Tehran slapped sanctions on 15 U.S. companies, including defense contracting giant Raytheon, as retaliation for earlier sanctions imposed by the United States.
In its statement Tuesday, Boeing touted the potential of the 737 deal with Iran to boost U.S. jobs, saying the agreement "creates or sustains approximately 18,000 jobs in the United States." The announcement comes as Boeing is laying off engineers in Washington, California and South Carolina amid broader cost-cutting measures.
“Boeing continues to follow the lead of the U.S. government with regards to working with Iran’s airlines, and any and all contracts with Iran’s airlines are contingent upon U.S. government approval,” Boeing said in the statement.