British Airways’ parent company, International Airlines Group (IAG), has announced a major aircraft order following the newly announced trade agreement between the United States and the United Kingdom.
IAG confirmed on Friday, as per multiple reports, the purchase of 32 Boeing 787-10 Dreamliner aircraft for its British Airways fleet. This $10 billion deal is seen as a direct boost to US manufacturing and comes just days after the trade deal that eased tariffs on aviation components.
Airbus order also confirmed
In addition to the Boeing deal, IAG also revealed an order for 21 Airbus planes, destined for its other airlines. While the Boeing aircraft will be powered by General Electric engines, the Airbus jets will feature British-made Rolls-Royce engines.
Trade deal spurs investment
The aviation order follows a US-UK trade agreement that slashes tariffs on a range of goods. The deal, praised by UK Labour leader Sir Keir Starmer, notably eliminates tariffs on plane engines and aircraft parts—seen as a crucial win for the aerospace industry.
US Commerce Secretary Howard Lutnick confirmed that “plane engines and other aeroplane parts are now excluded from trade tariffs,” marking a significant shift from earlier policy.
Relief after Trump tariffs
The order marks a turnaround from earlier trade tensions, when President Donald Trump imposed a blanket 10% tariff on British goods in April. The new deal cuts tariffs on British cars from 27.5% to 10% and fully removes a 25% tariff on steel.
Trump announces US-UK trade deal
US President Donald Trump on May 8 unveiling a new trade deal with the UK, called it a “maxed-out” agreement set to boost US exports. The deal lowers UK tariffs on US goods like beef and ethanol and cuts US tariffs on British cars from 25% to 10%, though a 10% baseline tariff remains.
UK Ambassador Peter Mandelson called it a “starting point” for deeper trade ties, while Trump said the agreement is flexible and will expand with growth.
