The Commerce Department will slap stiff tariff on Bombardier's new jet

The Bombardier CS 300 performs its demonstration flight during the Paris Air Show at Le Bourget airport north of Paris
Decision due from US on Bombardier trade dispute
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28 September, 2017

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Canada's foreign affairs minister Chrystia Freeland said Bombardier CSeries components are supplied by American companies that support nearly 23,000 jobs in US states, including Connecticut, Florida and New Jersey.

Prime Minister Theresa May said she is "bitterly disappointed" by the decision.

The determination stems from a complaint filed by Boeing with the International Trade Commission in April that Bombardier sold the narrowbody jets for well below their cost of manufacture with the help of improper subsidies from the province of Quebec and the Canadian federal government.

Washington, Sep 27 (AP) The Commerce Department slapped duties of almost 220 per cent on Canada's Bombardier C Series aircraft in a victory for Boeing that is likely to raise tensions between the United States and its allies Canada and Britain.

A United Kingdom government spokesperson from the Department for Business, Energy and Industrial Strategy said they were disappointed in the outcome, but emphasised it was "only the first step in the process".

"There is a specific niche for that airline and I don't think that either Airbus or Boeing are competing seriously with that airplane", he said. "We have contracts in place with Boeing for new maritime patrol aircraft and for Apache attack helicopters and they will also be bidding for other defense work and this kind of behavior clearly could jeopardize our future relationship with Boeing".

"Global trade works only if everyone plays by the rules that we've all endorsed to ensure fair competition, as adjudicated by independent national and worldwide bodies".

The case has major implications for Bombardier as it could not only endanger its deal with Delta, but also hinder future sales in the USA and hurt those Canadian aerospace companies that work with Bombardier.

The Democratic Unionist Party (DUP), which the Tories rely on to swing key Commons votes for the Government, has repeatedly pressed the Prime Minister over the Boeing/Bombardier issue.

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Around 1,000 of the 4,500 workers employed at the Northern Ireland facility are directly tied to the C Series programme.

Bombardier has announced plans to boost C Series production from seven airplanes in 2016 to between 90 and 120 airplanes by 2020. But one industry source said Boeing, which could gain some leverage with the Commerce Department's initial decision in its favour, sees the possible CSeries dumping as a long-term threat to its civilian airliner business.

It was reported earlier in September that the British prime minister, Theresa May, had pleaded with the U.S. president, Donald Trump, to intervene in the case.

US secretary of commerce Wilbur Ross said: 'The US values its relationships with Canada, but even our closest allies must play by the rules. May also criticized the Boeing case, arguing that it would cost jobs in Northern Ireland, where the wings for Bombardier's CSeries jet are built.

Leitao nonetheless tempered his optimism by noting that it could take a long time to resolve the case, which he said poses a risk to Bombardier and is why Quebec will continue to support it.

The scale of the tariff was higher than what Boeing had sought, and Bombardier could be hit by even more tariffs as the regulatory process continues.

Ms May's reaction to the ruling will be seen as a test of her government's ability to guide the United Kingdom economy into its new trade relations after Brexit.

Bombardier said in response: "The magnitude of the proposed duty is absurd and divorced from the reality about the financing of multi-billion dollar aircraft programs".

The grounds for Boeing's complaint focused on a £135 million investment by Northern Ireland's powersharing administration and the UK Government to establish the C-Series manufacturing site in Belfast.

Ross Murdoch, the GMB union's national officer, said it was a "hammer blow" to Belfast and risked sending shock waves through Northern Ireland's economy.


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