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Here's Why This Year's Presidential Election Could Have Major Implications For Boeing

Summary

Orders for Boeing aircraft in Western countries are generally based on merit and technical specifications while orders from developing regions depend heavily on governmental relations.

Candidates opposing views on the Ex-Im bank have the potential to cause trouble for Boeing sales in emerging markets where many customers rely on this financing.

Improved relations with Russia under a Trump presidency have the potential to pull Russia away from China and delay or shelve plans for a Chinese-Russian widebody aircraft.

For Boeing (NYSE:BA), the results of this year's presidential election have the potential to be a major positive for the company, or the potential to derail its growth in emerging markets.

While many Western operated airlines from Delta Air Lines (NYSE:DAL), to British Airways will buy the aircraft that best suit their needs based on pricing, availability, operating costs, performance, etc, outside most major western markets this is an anomaly. Government run airlines in many developing nations, or private airlines in many developing nations with strong government influence are pressured to source aircraft and large infrastructure purchases from specific countries in order to advance their government's diplomatic agenda. General Electric (NYSE:GE) and Boeing, the first and second largest U.S exporters respectfully and major sources of U.S employment are the poster children for U.S international relations. These two companies, due to their size and stature, tend to be rewarded with contracts from emerging markets to signify increased trade and relations between these countries and the United States.

An increasingly aggressive China has been a big positive for Boeing as it has pushed neighboring countries such as Vietnam, Laos, Malaysia and the Philippines to pursue closer ties with the United States and counterbalance China in the region. These closer ties result in large infrastructure orders for everything from military equipment to aircraft, healthcare infrastructure and energy infrastructure.

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