U.S. Says Taiwan Likely to Drop $1.5 Billion in Boeing Purchases

Taiwan’s government, angered at U.S. support of mainland China, is likely to drop plans to buy Boeing Co. aircraft worth $1.5 billion in favor of those made by European rival Airbus Industrie, U.S. officials said.

U.S. Sen. Slade Gorton, who represents Boeing’s home state of Washington, will meet with Taiwan’s president Monday to discuss the plans, according to a spokeswoman for Gorton.

China Airlines Ltd., the island nation’s state-owned carrier, in 1995 signed a letter of intent to buy 10 of Boeing’s 777 jetliners. It’s now likely to buy 12 Airbus A340 jets instead, said Cynthia Bergman, the spokeswoman. She said the dispute doesn’t affect the airline’s plan to buy 13 Boeing 747-400 cargo jets in a separate order worth at least $2 billion.

It is “particularly disturbing to me to learn that China Airlines and [Taiwan] intend to turn their backs on Boeing, the state of Washington and the United States and to order a significant number of aircraft from France, a nation not known for its support of the Republic of China on Taiwan,” Gorton said in a letter sent to a Taiwanese official in mid-July.

It was sent shortly after Lee Teng-Hui, Taiwan’s president, drew criticism from U.S. officials for a speech that was seen as inflaming tensions with China. He said he would only speak to mainland China as a separate state, questioning the “one China” policy the U.S. has maintained for decades.