With U.S.-China trade relations teetering as the Trump administration ramps up its rhetoric on potential tariffs, United Technologies CEO Greg Hayes told CNBC that any escalation could have something of a ripple effect on his business and its customers.
“We don’t want to see a trade war with China,” Hayes told “Mad Money” host Jim Cramer in a Friday interview. “We import a lot from China. They import a lot of aerospace parts from us and specifically from Boeing. As you know, Boeing is the biggest customer that we have on the aerospace systems side.”
Shares of Boeing, which buys aircraft systems and components from United Technologies, have sunk since the president signed a proclamation implementing steel and aluminum tariffs.
Dragging the Dow Jones industrial average down with it, Boeing’s stock sank over 2 percent on Wednesday after reports suggested Trump was considering also placing $60 billion worth of tariffs on Chinese goods.
Investors and market-watchers feared that China’s first retaliatory step could target Boeing, which recently signed a multi-billion-dollar contract to sell airplanes to a Chinese company.
Hayes emphasized to Cramer on Friday that “nobody wins” in a trade war.
“I think the fear is if we get into this tit-for-tat on tariffs, that’s going to be a problem,” the CEO said. “So hopefully the Chinese will react as they have so far, which is with some pause, and we’re not going to go down a bad path here, but it is a concern.”
However, Hayes was not as worried about the tariffs’ effects on his business, even as United Technologies purchases around 600,000 tons of steel and 3 million pounds of aluminum a year.
“As we think about the impact to the business in the short term, it’s not going to be significant,” he said. “But it’s one of those worries out there, again, if you start with tariffs on steel and aluminum, where do you go next?”
Questions for Cramer?
Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer’s world? Hit him up!
Mad Money Twitter – Jim Cramer Twitter – Facebook – Instagram – VineQuestions, comments, suggestions for the “Mad Money” website? madcap@cnbc.com
