Boeing CEO Downplays Loss of $20 Billion Agreement With Iran

Iran Air A321

Boeing CEO Downplays Loss of $20 Billion Agreement With Iran

President Donald Trump's announcement that the U.S would seek to reimpose sanctions left little hope that the planemaking duopolists will be able to consummate $40 billion in aircraft deals struck by Iranian carriers during the brief trade thaw. The French firm now has a contract with Iran Air for 100 planes worth about $19 billion according to Gizmodo and, unlike Boeing, the firm has included its deals with Iran in its order book.

"And the second thing is what happens with Airbus orders that have been made because, of course, some of the parts may be coming from the United States or anything that has any USA content and any dealings with U.S. and then gets re-exported to Iran is going to come under scrutiny". It further announced another agreement in April 2017 to sell Iran 30 Boeing 737 MAX aircraft for $3 billion, with purchase rights for another 30 planes.

"We will consult with the U.S. Government on next steps".

"No new contracts are permitted" he said.

In remarks published on Tuesday before the Treasury's announcement, Airbus had said it would study Trump's decision on the JCPOA, noting that it would take some time.

But Mattis, in private conversations, has also stressed the need to act with allies, given the threat he believes that Iran poses in the region, one US official familiar with the conversations told Reuters.

"I can tell you with confidence that we've continued to build risk mitigation into our 777 production plan", CEO Dennis Muilenburg said during the company's first-quarter conference call last month". The ones who will end up losing are American firms (as we're seeing with Boeing), who will lose the opportunity to employ more people at home and grow the USA economy.

One company hoping for a reprieve is the French oil giant Total, which previous year signed a $2 billion contract to develop the South Pars natural gas field.

Meanwhile, France's PSA Group (pugoy)-the company that makes Peugeots and Citroens-has also been keenly selling into Iran.

Lockheed Martin (LMT), Northrop Grumman (NOC) and other defense stocks rallied as President Trump's plan to leave the Iran nuclear deal turned up the heat on already-rising tensions in the Middle East.

President Trump has called the deal "defective at its core", claiming that it is not enough to prevent the creation of an Iranian nuclear bomb, despite the reduction of Iran's uranium stockpile by 98% and mandatory access for independent global bodies to inspect nuclear facilities.

When asked about this loss, Boeing's VP of Government Operations Communications Gordon Johndroe simply said that the firm was going to comply with the law.

"These sanctions do impact all of the major industries", Mnuchin added.

"That's something we'll consider on a case-by-case basis, but as an overview, I would say that the goal is to broadly enforce the sanctions", he said, adding the administration's objective was to deny Iran access to the USA financial system.

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