Why Airbus Stock Is Falling Again
A comment from Delta shook Airbus stock this week.
For the second day running, shares of Europe's Airbus (OTC: EADSY) are declining. As of 11:40 a.m. ET Friday, the aerospace giant's stock is down 2.9%, bringing losses for the past two days past 6%. But why?
Yesterday, Delta Air Lines (NYSE: DAL) told investors on its morning quarterly conference call that the airline intends to "minimize" any tariffs it might have to pay under President Donald Trump's on-again, off-again "reciprocal tariffs" initiative. Said Delta CEO Ed Bastian: "The one thing that you need to know we're very clear on is that we will not be paying tariffs on any aircraft deliveries we take. ... we've been clear with Airbus on that, and we'll work through and see what happens from that."
Now, you might think that's not really Delta's decision to make. The way tariffs work at a basic level is, the U.S. government sets a tariff rate on goods (like airplanes) imported from abroad. And then whoever imports those goods (like Delta) pays the tariff. Except Delta seems to be saying this is not going to happen, and the question then becomes, if Delta isn't paying the tariffs, then who is?
