GE Aerospace Faces Tariff Pressure Amid Delivery Decline

GE Aerospace

Supply Chain Issues and Tariffs Impact Engine Shipments

GE Aerospace, a major U.S. aircraft engine manufacturer, delivered 444 engines in Q1 2025, down 9.2% from last year. LEAP engine shipments dropped 13% to 319 units due to supply chain disruptions, including slow material inputs in January. Although deliveries improved in February and March, challenges persist, particularly with spare parts.

The company estimates a $500 million profit hit from U.S. tariffs despite using tools like free trade zones and duty drawbacks. GE warned that future earnings could weaken if delivery schedules change or tariffs escalate. To manage this, it plans to cut non-production costs, raise prices, and renegotiate supplier contracts.

GE Urges Restoration of Aviation Tariff Exemptions

CEO Larry Culp urged the U.S. government to restore the "zero-for-zero tariffs" policy from the 1979 Civil Aircraft Agreement. He noted that the U.S. enjoys a $75 billion trade surplus in aviation and that maintaining a tariff-free environment supports this strength. Meanwhile, GE continues shipping LEAP engines with upgraded turbine blades to improve durability.

Despite engine delivery setbacks, GE’s commercial aerospace segment saw a 17% rise in aftermarket revenue, reaching $5.1 billion. First-quarter profit rose 13% to $2.2 billion, and total revenue increased 11% to $9.9 billion.

The Metalnomist Commentary

GE Aerospace’s tariff exposure highlights the fragility of aerospace supply chains amid geopolitical pressures. Its proactive pricing and operational shifts suggest resilience, but the industry still faces uncertainty unless trade tensions ease.