On a diplomatic mission in the Middle East, President Donald Trump generated significant attention for American corporations, particularly Boeing and GE Aerospace. While diplomacy took center stage, Trump’s ability to secure lucrative contracts cast a spotlight on the U.S. aerospace sector. Agreements reached on this trip could potentially reinvigorate confidence in these corporations, given the substantial orders now added to their portfolios.
Previously, in similar diplomatic tours, U.S. leaders have often combined diplomatic efforts with trade negotiations. Corporate giants like Boeing and GE have historically capitalized on these opportunities to expand further into global markets. Earlier deals involved similarly large contracts, though not always matching the current scope in financial terms. Trump’s recent success draws parallels to past presidential visits where trade discussions have seamlessly integrated with international diplomacy, thus boosting the American industrial footprint abroad.
How Did Boeing and GE Benefit?
Qatar Airways, in a move that caught investor attention, placed an order for 210 Boeing widebody jets. This record-breaking deal for the American manufacturer is valued at $96 billion. The agreement also includes GE’s commitment to provide 400 engines to power the Boeing aircraft. Boeing had faced challenges due to safety and production concerns, but this deal seems poised to stabilize its standing in the aviation market.
What Impact Does This Have on Employment?
According to Boeing CEO Kelly Ortberg, this agreement will result in the creation of 400,000 jobs across the United States. All involved aircraft are slated for production in American facilities, underscoring a vital boost to domestic employment. The job creation aspect aligns with broader economic objectives, ensuring that these deals have tangible benefits for American workers.
“All of these aircraft will be built in the United States, creating a significant number of jobs,” Ortberg commented.
This surge in beneficial contracts is consistent with analyst ratings, predicting an upward trajectory for both Boeing and GE Aerospace stocks. As confirmed by ThomsonOne tracking, a majority of the analysts endorse these stocks, bolstered by these recent developments in the Middle Eastern market. This optimism aligns with prior sentiments in the market, though the scale of this deal provides even stronger approval.
Moreover, the recent agreements contributed to a marked performance of these stocks against the S&P 500, with both Boeing and GE surpassing the index’s growth by a notable margin. Following the Qatar deal, the companies have also accumulated $14.5 billion in contracts from Abu Dhabi’s Etihad Airways for various aircraft models, further solidifying their market stance.
“Our GE NX, which powers the 787, the fastest-selling high thrust engine in history, and our new 9X will power the 777X,” remarked GE Aerospace CEO Larry Culp.
Trump’s capability to secure over $2 trillion in Middle Eastern deals, such as the extensive economic exchange agreement with Qatar, reinforces the strategic approach of combining diplomacy with trade outreach. This illustrates a pattern where international relations and commercial interests are carefully intertwined to ensure mutual economic benefits.
