A Boeing-Iran Deal Could Be On President-Elect Trump's Chopping Block

Dec 12, 2016
Originally published on December 13, 2016 7:47 am
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Boeing plans to sell more than $16 billion in commercial aircraft to Iran. It's the largest deal made by a U.S. companies since international sanctions were lifted on Iran earlier this year. President-elect Donald Trump says he wants to derail the nuclear agreement that makes such deals possible. NPR's Jackie Northam reports.

JACKIE NORTHAM, BYLINE: The deal involves the sale of 80 commercial aircraft. It's a mix of single-aisle and wide-body extended-range jets, including the best-selling version of the 777. In a statement, Boeing was careful to note the company worked closely with the U.S. government to secure a license to sell to Iran. And that the deal would affect Boeing's vendors and suppliers across the country. Gordon Johndroe is a spokesman for Boeing.

GORDON JOHNDROE: Today's agreement will support tens of thousands of U.S. jobs directly associated with the production and delivery of the Boeing 777 and nearly 100,000 U.S. jobs in the U.S. aerospace supply chain.

NORTHAM: Even before the ink was dry, there was speculation whether the deal would fall apart. Richard Aboulafia, an analyst with the Teal Group, an aerospace consultancy, says there are multiple risks involved with the sale.

RICHARD ABOULAFIA: First of all, the ability of Iran to actually finance the large and ambitious jet purchase is highly suspect given oil prices and given the difficulty in lining up third-party finance.

NORTHAM: Aboulafia says the bigger risk is just surviving President-elect Trump, who has called the Iran nuclear agreement signed by six world powers a disaster and the worst deal ever negotiated. But without the Iran nuclear agreement, sanctions would have prevented the Boeing deal from ever happening. Aboulafia says Trump will have to decide if he wants to renegotiate the nuclear agreement, cancel it or let the Boeing sale go ahead.

ABOULAFIA: I mean, on the one hand he has a fondness for red meat for the base, which means move against trade, move against Iran. On the other hand, jobs, jobs, jobs. There's absolutely no way of telling how this will play out.

NORTHAM: Matthew McInnis, an Iran specialist at the American Enterprise Institute - AEI, says House Republicans are already trying to block the deal. He says a lot will depend on who Trump chooses to surround him, especially as secretary of state.

MATTHEW MCINNIS: I think President-elect Trump is going to find he's dealing with a lot of very negative perspectives on the deal. I mean, he has a lot of people around him reminding him there's a lot of bad stuff in this deal and the Iranians are still up to a lot of no good in the region.

NORTHAM: If Trump does decide to renegotiate or unravel the Iran deal, it could be a boon for Boeing's fiercest competitor - Airbus. Iran has already announced it plans to buy $27 billion worth of aircraft from the France-based company. AEI's McInnis says Boeing has an army of lobbyists in Washington ready to press its case. He says the aircraft manufacturer is trying to establish a long-term stake in Iran, that the deal for new jetliners is as much a political arrangement as it is an economic arrangement for both sides.

MCINNIS: A key part of the Iranian strategy, you know, is to build that relationship with Boeing because they see that relationship as crucial for, you know, having that - a very strong voice inside Washington.

NORTHAM: If the deal holds together, the first Boeing jetliner is due for delivery in Iran in 2018. Jackie Northam, NPR News, Washington. Transcript provided by NPR, Copyright NPR.