In this video presentation, I take a deep dive into the disruptive effects of President Trump’s erratic tariff policies, specifically how his on-again, off-again, and on-again tariff measures are sending shockwaves through the global aviation industry.
This article is a condensed transcript of my video. For greater details and charts, watch the video.
While tariffs are often pitched as tools to protect domestic interests, the aviation sector, deeply interconnected, globally sourced, and reliant on long term stability, is especially vulnerable to this kind of policy whiplash.
From aircraft manufacturers to component suppliers and from international carriers to airport infrastructure developers, nearly every segment of the industry is feeling the strain. Specifically, I focus on one major ramification: how China is decoupling from Western avionics technology.
I also make it clear that U.S. and European avionics remain too advanced, too embedded, and too essential for China to make a clean break, regardless of Beijing’s aggressive attempts to become more self-reliant.
Striving for a China-centric avionics ecosystem…
We’re witnessing a transformation that could redefine the aviation industry for years to come. Let’s talk about decoupling from Western avionics and supply chains.
The overarching Made in China 2025 initiative has received hundreds of billions of dollars in total support, including state funding, low‑interest loans, and tax subsidies.
Specific funding includes about US $20.2 billion for the National Integrated Circuit Investment Fund and US $2.9 billion for the country’s Advanced Manufacturing Fund, which supports avionics‑relevant semiconductors, processors, and related technologies.
I’m seeing firsthand how the pressure of Western tech export restrictions, especially those targeting Chinese giants like the Aviation Industry Corporation of China (AVIC), is sparking a seismic change in the industry. It’s not just a minor adjustment it’s a fundamental shift in how things are done. Here’s what’s happening.
China isn’t just scrambling for spare parts. They’re looking at the bigger picture and planning for the long term. State backed firms are using this moment to accelerate the development of domestic alternatives to the likes of Honeywell, Collins Aerospace, and Thales. We’re talking about full scale efforts to build indigenous fly by wire systems, radar altimeters, and flight management platforms.
This is about creating a complete self-sufficient ecosystem for avionics manufacturing. Government subsidies? They’re pouring in. The scale of investment is truly remarkable.
The result is a new generation of homegrown avionics, purpose built to sidestep reliance on the West. These systems are designed to meet the specific needs of the Chinese aviation market.
Now, why does this matter if you’re sitting in Seattle or beyond? This isn’t just a regional issue; it has global implications. America’s technological and geopolitical dominance is now under serious threat from China.
This isn’t just because of China’s ambitions but also due to America’s own self-inflicted wounds, such as political disarray, rising protectionism, and a lack of unified strategy.
These vulnerabilities have opened the door for China to challenge the U.S. in ways that would have been unthinkable just a decade ago.
The ability to sell your products in a key market like China is crucial for success. China’s appetite for new aircraft is massive; the country buys about 20% of all Boeing and Airbus jets.
That’s a significant portion of their overall sales. But if Western manufacturers can’t supply the avionics and components, that door starts to close.
The size of the Asia-Pacific aviation market is estimated at US $105.33 billion so far in 2025, and is expected to reach US $160.68 billion by 2030, at a compound annual growth rate (CAGR) of 8.81% during the forecast period (2025-2030), according to Mordor Intelligence. China is the linchpin of the region.
We’re already seeing signals that China is pivoting toward supporting its own airframers and suppliers and if that happens, the West risks getting locked out of one of the fastest growing aviation markets on the planet. This would represent a major loss for Western aerospace companies.
There’s a longer-term risk, too: a new split in aviation technology. This bifurcation could create significant challenges for international collaboration and interoperability.
Cold War redux?
Think back to the Cold War, an era in aviation of separate standards, incompatible systems, and fragmented supply chains.
We witnessed intense competition and limited cooperation. We’re on the brink of seeing that dynamic play out again, but this time with a digital twist, as both sides double down on their own solutions.
It’s a strategic challenge that will shape how we design, certify, and sell aircraft for decades to come. The question isn’t whether decoupling will happen; it’s how fast and how far it will go.
For the global aerospace industry, the impact has been profound. Companies are forced to rethink supply chains, invest in new technologies, and navigate a world where access to key markets is no longer guaranteed.
Unpredictable U.S. policy may push other countries to seek alternative suppliers. As the U.S. and China continue to compete for dominance in the skies, the rest of the world is left to adapt.
But it won’t be so easy for China…
However, China’s push to decouple from Western avionics is far more complicated than official rhetoric suggests.
While Beijing seeks self-reliance in high-tech sectors, U.S. and European avionics remain more advanced, deeply embedded, and globally dominant.
The aviation supply chain in particular is notoriously complex and interdependent. Take the C919, China’s flagship attempt at a domestically produced jetliner, built by the Commercial Aircraft Corporation of China (COMAC).
Despite its nationalist branding, the aircraft is packed with western components, from avionics to engines supplied by firms like Honeywell, GE, and Safran.
China’s aviation ambitions are dependent on Western technology, despite Beijng’s nationalist ambitions and Washington’s protectionism.
That’s why in any escalating trade war, there are no clean victories. Every side incurs damage, especially in an industry as globally interwoven as aerospace.
