Tariff turbulence: RTX and GE Aerospace brace for over $1 billion hit from trump-era duties
Shreeaa Rathi | TIMESOFINDIA.COM | Apr 22, 2025, 20:33 IST
( Image credit : TIL Creatives )
New tariffs imposed by President Trump are projected to cost RTX and GE Aerospace over $1 billion. These tariffs, impacting imported goods, steel, and aluminum, challenge the aerospace industry's global supply chains. While GE Aerospace aims to offset costs through cuts and price adjustments, the industry faces uncertainty amid broader aviation concerns and fluctuating demand.
The American aerospace industry is feeling the weight of a new wave of tariffs introduced by President Donald Trump, with leading manufacturers RTX and GE Aerospace projecting a combined impact exceeding $1 billion. These anticipated losses signal rising costs for U.S. manufacturers deeply embedded in a global supply chain.
RTX, formerly known as Raytheon Technologies, reported during its quarterly earnings call that it expects to absorb approximately $850 million in tariff-related costs this year. Neil Mitchill, the company’s Chief Financial Officer, noted that this figure includes the effects of Trump’s sweeping 10% tariffs on a broad range of imported goods, along with increased duties targeting nations such as China and separate levies on imported steel and aluminum. Mitchill clarified that this estimate excludes any potential savings from internal mitigation efforts the company may implement.
Meanwhile, GE Aerospace—supplier of engines to industry giants Boeing and Airbus—faces its own challenges. The company, which has maintained its 2025 earnings outlook, is strategizing to offset about $500 million in anticipated costs. CEO Larry Culp shared during an analyst call that GE plans to achieve these savings through cost-cutting initiatives and price adjustments.
Culp also revealed that he recently met with President Trump to discuss the U.S. aerospace sector’s trade surplus, emphasizing the industry’s global reach and the benefits of longstanding duty-free trade agreements. GE Aerospace, through its partnership with France’s Safran, produces some of the world’s most widely used jet engines. The new tariffs mark a stark departure from the relatively frictionless international trade environment aerospace companies have enjoyed for decades.
“All we have suggested,” Culp stated, “is that as the administration works through a myriad of issues, it considers the position of strength this country enjoys thanks to a tariff-free regime.”
The White House has not issued an official response regarding these concerns.
This policy shift arrives at a particularly uncertain moment for the broader aviation industry. Boeing, which is both a key customer and a major exporter, is set to release its quarterly earnings the day after RTX and GE’s announcements. Meanwhile, airlines have begun scaling back domestic capacity plans in response to weaker demand. United Airlines recently provided dual forecasts for 2025—one assuming a potential recession, and another based on current economic conditions—highlighting the difficulty of predicting future market behavior.
“There is uncertainty,” Culp acknowledged. “None of us, I think, know for sure how this plays out.”
As the industry braces for turbulence, aerospace leaders are hoping that policy decisions will account for the intricate global ecosystems their operations depend on. One thing is clear: the future of American aerospace will hinge not only on innovation and performance but also on the evolving landscape of international trade.