Air Lease Corp. has canceled its order with Airbus for seven A350 next-generation freighter jets, the company’s top executive said on Monday’s earnings call with analysts.

Airbus quietly revealed that Air Lease (NYSE: AL)had backed out of the order when its monthly orders and delivery report on July 9 indicated seven fewer orders for the new widebody cargo aircraft. Air Lease officials at the time refused to comment on the change.

Chief Executive Officer John Plueger confirmed that Air Lease canceled the Airbus, saying development delays and the proliferation of tariffs contributed to the decision.

“We think the A350F is a terrific freighter, but since we made that order in December of 2021, we simply decided to stick with new passenger airliners versus venturing into new freighters. Contractually, the majority of our A350F aircraft were more than a year late. This cancellation frees up more than $1 billion in forward cap ex commitments, making that capital available for other alternatives,” he said.

The trend of countries erecting tariff barriers on goods has created uncertainty about the level of trade growth and made some all-cargo operators a bit cautious about committing to new aircraft, added Plueger.

Boeing recently downgraded its 20-year forecast for air cargo volumes to 3.7% compounded annual growth from 4.1% in its 2024 commercial market outlook. The slight downgrade partially reflects estimates for slower long-term economic growth.

Los Angeles-based Air Lease, which manages a portfolio of 495 aircraft, was the original customer for the A350 freighter when it signed a non-binding letter of intent at the 2021 Dubai Air Show.

Airbus has secured 66 orders for the A350F, which is scheduled for first delivery in late 2027. The manufacturer has pushed back the start date several times, including in February because of production delays at a major component supplier. Air France-KLM trimmed its order from eight to six A350Fs in March and converted the two production slots to A350-900 passenger aircraft.

The A350F, powered by Rolls-Royce Trent XWB-97 engines and with 70% of the airframe made of advanced composite materials, is expected to be 20% more fuel efficient than the Boeing 777 and older Boeing 747-400 freighters, according to Airbus. The manufacturer said the lightweight materials will make the plane 50 tons lighter than the Boeing 777X freighter, which is also in late development.

The aircraft is designed to carry up to 120 tons with a maximum range of 4,700 nautical miles. It will feature the industry’s largest main deck cargo door to ease loading of shipping containers and out-of-gauge cargo. The large cargo door offers the option of using 20-foot shipping containers, something that is rarely, if ever, done with traditional side-loading aircraft, said Crawford Hamilton, head of freighter marketing at Airbus, in an interview last year with STAT Media Group.

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