Commerce Department places 220% duty on Canada's Bombardier jets

Share

The Commerce Department in the US said the 220% duty was imposed on the new jets from Bombardier after a preliminary finding was made of subsidization.

Shares of Alten (OTC:ABLGF), Trelleborg (OTCPK:TBABF), Safran (OTCPK:SAFRY) and Zodiac Aerospace (OTCPK:ZODFY) may be active following the ruling by the U.S. Commerce Department. Couillard countered it was an investment, not a subsidy, and added that Boeing has benefited from decades of US government assistance.

"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".

Washington has imposed preliminary anti-subsidy duties of 220 percent on Bombardiers CSeries jets. The ruling comes ahead of planned delivery next spring of the first of 75 Bombardier CS100s to Delta Air Lines, the US launch customer for the program.

But doing so could significantly depress the net amount Bombardier receives and could be seen as legitimising Boeing's complaint on prices, which Bombardier has rejected.

British Prime Minister Theresa May said that she was "bitterly disappointed" by the ruling after she had personally asked for President Trump's help in the dispute, according to the report.

In a statement last week entitled "Boeing's Hypocrisy", Bombardier criticized the company's trade practices overseas and urged the U.S. Commerce Department to reject its bid.

As well, Boeing did not have any suitable jets with which to bid at the time the Delta deal was awarded to Bombardier in 2016. About 1,000 jobs at the Belfast plant that are directly linked to the production of the C-Series wing could be lost, officials say.

A favorable ruling for Boeing was expected, but not the steep duties Commerce proposed: 219.63 percent of the value of each C Series jet Bombardier sells into the U.S.

"A country like the United States can not shut us down from their border or prevent us from selling our aircraft over there like they are doing right now".

"We produce a product that competes in a size category where Boeing does not compete", Bombardier Commercial Aircraft CEO Fred Cromer said during a briefing with reporters at the company's facilities in Mirabel, Canada, on September 12. The International Trade Commission will do a thorough review of the evidence in the coming months and determine if Boeing's claims are valid and could uphold the tariff, reduce it, or drop it altogether. The real fight between the Canadian taxpayer and the Bombardier and Beaudoin families, however, should not be overshadowed by Prime Minister Justin Trudeau's show of strength in calling for a halt of the country's F-18 deal with Boeing.

"With jobs and future prosperity in the region being put at risk by decisions made far away from Belfast, we need a devolved government that can speak up for and champion the needs of the local workers and businesses most affected".

Share