European businesses and their representatives in government were thrown into disarray by President Trump's threat to reimpose sanctions on trade with Iran.
The Iranian orders represent a small percentage of the massive aircraft backlogs of both manufacturers.
European planemaker Airbus said on Tuesday before the Mnuchin news conference that it would study Trump's decision, adding that it would take some time. Even before his statement, the press Secretary of the Boeing company Gordon jandro announced that the Corporation will be guided by the decisions of the U.S. administration. "As we have throughout this process, we'll continue to follow the US Government's lead".
The company separately struck a 30-airplane deal with Iran's Aseman Airlines for $3 billion at list prices. Following the Syria strike Boeing, Lockheed Martin, Northrop Grumman and aerospace firm General Dynamics gained almost $5 billion in market value despite the wider market slumping.
By contrast, Boeing Chief Executive Dennis Muilenburg signalled last month that his company was no longer as dependent on the Iran orders as it had been, following an aggressive effort to improve sales of its current-generation 777-300ER wide-body jets which were part of the Iran deal. "I can tell you with confidence that we have continued to build risk mitigation into our 777 production plan".More news: Oil prices jump after United States walks away from Iran nuclear deal
Mnuchin said that the new sanctions would allow countries doing business with Iran to wind down those activities in either 90 or 180 days, depending on the type of products being sanctioned.
It had already delivered three jets, though as with other businesses working in Iran had found numerous diplomatic and bureaucratic hurdles in its...
But Airbus likely won't be able to take further competitive advantage.
Iran, which had ambitions to turn Tehran into a regional aviation hub, has been denied the opportunity to renew its ageing fleet of aircraft after the U.S. withdrawal from a nuclear pact with the Islamic Republic barred plane sales by Boeing and Airbus.
While European countries are staying in the deal, Airbus will likely have to pull out of the contract as it needed a US license for the deal since over 10% of parts and labor were provided by USA companies. According to U.S. Treasury Secretary Steven Mnuchin, export licenses for those two orders will be revoked.More news: Atletico Madrid tells Barcelona 'enough is enough' over Antoine Griezmann pursuit
"We're carefully analyzing the announcement and will be evaluating next steps", a spokesman for Airbus said, though that may "take some time". "The extra-territoriality of USA sanctions makes the US the economic policeman of the planet, and that is not acceptable".
"It is now a better market for arms sales, period", Mr. Aboulafia said. However, it faces potentially costly industrial decisions over the rest of the 20-plane deal.
Airbus has 97 planes for Iran on its backlog.
France, which has had close business ties with Iran since before the fall of the Shah in 1979, has sought to deepen trade ties since sanctions against Iran were lifted in 2016.
European Union trade with Iran has almost tripled, from $9bn in 2015 when sanctions were lifted, to $25bn.More news: Chris Paul's Brother Gets Ejected But Returns After One Play
Iran President Hassan Rouhani mirrored the sentiment, saying he was happy to do business with the other partnering countries. If Airbus wants to keep selling planes into the world's biggest aviation market, that deal - along with a similar-sized order for Boeing planes - looks dead.