By Clay Chandler and David Meyer
March 20, 2019

Good morning. Clay Chandler here, filling in for Alan from Hong Kong.

Since the beginning of President Trump’s face-off with China over trade, it has been assumed that Boeing would be a windfall beneficiary of a final U.S.-China trade agreement.

Trump has long insisted that any deal between the two countries include provisions to eliminate China’s trade surplus with the U.S. Many economists doubt that the bilateral trade balance can (or even should) be reduced to zero; few questioned whether Chinese purchases of Boeing aircraft—along with increases in Chinese imports of American soy beans and natural gas—would be part of any final resolution.

As Bloomberg notes, Boeing is the only non-consumer, non-tech company in America that gets more than $5 billion of revenue from China; little wonder that Boeing jets were included on a draft list of American products China would purchase.

But the crash two weeks ago of a second Boeing 737 MAX in less than six months has cast doubt on Boeing’s prospects.

China was the first country to ground the 737 MAX jet after the Ethiopian Airlines flight went down. The Civil Aviation Administration of China acted unilaterally, two days before the U.S. Federal Aviation Administration followed suit, idling more than a quarter of Boeing’s 737 MAX fleet. That decisiveness stunned many industry experts. Previously, China’s airspace regulators have simply followed guidance from the FAA.

Bloomberg reports that China also is considering excluding the aircraft from its American shopping list. It’s unclear whether that exclusion would apply to all Boeing aircraft or only the 737 MAX. Chinese airlines accounted for 20% of 737 MAX deliveries worldwide through January. China Southern has 16 of them, with another 34 on order.

If nothing else, China’s stance on Boeing since the crash in Ethiopia highlights the new assertiveness of the nation’s aviation regulators. Boeing was positioned to benefit from China’s rise as the world’s largest market for air travel. But it is discovering that China wants clout commensurate with its size.

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And out this morning is my feature on two scrappy and ambitious ride-hailing startups—Singapore-based Grab and Jakarta-based Go-Jek. The two are locked in a fight for dominance of the region’s on-demand service market. The duel highlights the power of the super-app model, and why, when it comes to providing online services, homegrown upstarts have an advantage over global tech giants. You can read the story here.

Clay Chandler
@claychandler
clay.chandler@fortune.com

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