Donald Trump’s tariff increase is changing the way the airline industry works. In the United States the air transport is being affected by the Trump government’s trade policy imposed for airplanes, engines and other pieces coming from foreign countries. So, the airline industry is dealing with an extra amount they didn’t have to pay before and they are worried. They are demanding a review of this policy, so that their airlines don’t get affected.
Trump’s tariffs have been a controversial and worrying issue for many companies from car manufacturing, products and now airlines. Let’s see why Donald Trump is imposing this tariff hike and what the consequences are for American airlines.
Air transport situation in the United States
Donald Trump is provoking uncertainty among business owners. Why? Well, it’s nothing new the president of the United States of America is on the news for a controversial situation. Now, he is coming face to face with airline companies.
Airline manufacturers and companies are very concerned about tariff increase on planes, engines and other pieces provided by countries other than the U.S.
What are Donald Trump’s tariffs?
Tariffs mean paying a certain amount of money, also known as tax, for imported goods. This is what Trump is doing, well… kind of. He is not just imposing them, but he is raising them.
From April of this year, airline companies are paying a 10% tariff on imported planes and pieces. Wait, that’s not all. The U.S. Department of Commerce started a Section 232 investigation whose aim is to check if imported products are a risk to national security. If this is the case, the American government will increase the tariffs even more.
This is why most of the airline industry companies are most worried. They fear they will have to pay over the top amounts which might be a negative situation for the economic situation for these airlines.
Two big airline industry groups are speaking out
Due to the huge concern on this tariff issue, two important groups involved in the airline industry are taking action and are stating their disagreement on the government’s decision by sending them a formal complaint. These groups also claim a review on this new trade policy.
One of the groups is the Aerospace Industries Association (AIA). This association represents important companies like Boeing, Airbus, RTX and many more companies that manufacture plane technology and pieces.
The other one is Airlines for America (A4A). here you will find the representation of companies like American Airlines, United Airlines and Delta Air Lines. Probably more popular airlines among society.
Negative consequences for the airline industry
Airline companies expect many negative consequences if this new policy reaches them. Not only airlines will be affected, but also passengers. We are always collateral victims on every issue. Let’s see what will happen now:
- Prices won’t be the same. As mentioned before, imported pieces will experience a tariff increase, which will lead to higher prices on the planes’ maintenance.
- Air security impact. Now, it will be more difficult to give a fast and quality maintenance, so planes will be flying without having old pieces changed.
- Expensive tickets. Having in mind plane pieces will be more expensive, this also is reflected on plane tickets. Bad news for us, passengers.
What’s next?
Well, the U.S. Department of Commerce hasn’t taken a stance yet. There is no deadline to come up with a final decision, but what is known is that the decision will mean a negative or positive impact on the United States global airline industry.
Now that you know more about these companies’ frustration, you can better understand why this is a controversial issue. I think you will agree with me on the fact that it’s not fair we are always the ones affected by every company and government decision, am I right? We’ll see what’s the resolution to this problem.