Transport

Bombardier welcomes end to Boeing trade case

US ruling allows Bombardier to sell CSeries aircraft in the US without hefty duties

A Bombardier CSeries CS100 prototype at Zurich airport. Boeing had argued that the CSeries jets benefited from unfair subsidies and was dumped below cost in the US

Fri Mar 23 2018 - 17:28

Boeing's decision to end its trade case over the sale of Bombardier CSeries jets to US carriers is good news for the aerospace industry and the public, the Canadian plane and train-maker said on Friday.

Boeing said late on Thursday it would not appeal a US trade commission ruling that allows Bombardier to sell its CSeries in the US without hefty duties. A Boeing spokesman did not give a specific reason for the company's decision.

“Boeing’s claim was meritless, and should never have been brought,” Bombardier said in a statement. “We are happy that it has come to an end.”

Boeing had argued that the CSeries jets benefited from unfair subsidies and was dumped below cost in the US. The case heightened trade tensions between the plane-maker, the US and Bombardier’s allies Canada and the UK. The 110-130 seat jet’s wings are produced in Belfast.

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US-Canadian trade relations have been complicated by disputes over tariffs on Canadian lumber and US milk, and US president Donald Trump’s desire to renegotiate the North American Free Trade Agreement.

Large plane-makers are becoming increasingly focused on smaller jets. Airbus has agreed to take a majority stake in the CSeries in a deal expected to close later this year, while Boeing is in tie-up talks with Bombardier's Brazilian rival Embraer.

Fighter jets

It is not yet clear how Boeing’s decision will impact on its relationship with the Canadian government, which is holding a competition for fighter jets worth $15-18 billion (Canadian). Ottawa says bids will be evaluated in part by whether firms have caused any past economic damage to Canada – a clear reference to Boeing.

Procurement minister Carla Qualtrough told Reuters last month that the government had not yet “decided how far back into the past companies’ [actions] will be analysed”.

US aerospace analyst Richard Aboulafia said the trade dispute may not lead to long-term damage, especially if Boeing starts “a new messaging campaign” with Canada and the UK.

“I think mistakes were made,” said Mr Aboulafia, vice-president, analysis, at Teal Group. “But there aren’t a lot of alternatives. And memories aren’t that long in aerospace and politics.” – Reuters

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