Bombardier welcomes decision to overturn punitive US tariff

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January 27, 2018
Airbus deal C Series
Delta Air Lines ordered 75 C Series aircraft. Photo: Delta

Bombardier, Delta Air Lines and Airbus have welcomed a surprise decision by the US International Trade Commission to overturn a punishing tariff of almost 300 percent on C Series  aircraft.

In a move that left-footed aviation industry pundits, ITC commissioners voted 4-nil to overturn a US Commerce Department recommendation to slap a duty of 292 percent on the Canadian manufacturer’s C Series jets for five years.

The Commerce Department decided to impose the tariff after Boeing filed a trade complaint  in April, arguing Bombardier was subsidised by the Canadian government and was able to sell its planes in the US at an unfair discount.

But the ITC determined that a US industry was not  materially injured or threatened with material injury because of the import of the jets.

“As a result of the US ITC’s negative determinations, no antidumping or countervailing duty orders will be issued,’’ it said.

Bombardier hailed the decision as “a victory for innovation, competition, and the rule of law”.

“It is also a victory for US airlines and the US. traveling public,’’ it said.

“The C Series is the most innovative and efficient new aircraft in a generation. Its development and production represent thousands of jobs in the United States, Canada, and the United Kingdom.”

Bombardier and Airbus last year announced a deal which saw the European manufacturer agree to take a 50.1 percent stake in the company that builds the C Series.

“With this matter behind us, we are moving full speed ahead with finalizing our partnership with Airbus,’’ Bombardier said. “Integration planning is going well and we look forward to delivering the C Series to the US market so that US. airlines and the US flying public can enjoy the many benefits of this remarkable aircraft “

Airbus chief executive Tom Enders later reaffirmed that plans to build the C Series in the US state of Alabama would proceed.

“I am happy that they decided like that. It shows that sober business is still prevailing, and it does not change our project; we will go ahead full throttle,” Enders told Reuters.

“The single largest market for the C Series – as also for the (larger mainline) single-aisle – is the U.S. and it cannot be wrong to have a strong position in the U.S.”

Delta, which has ordered 75 CS100s  with options for 50 more,  said it was looking forward to introducing the 110-seat plane to its fleet.

READ: Delta May base new Bombardier jets in New York, LA

“Delta is pleased by the U.S. International Trade Commission’s ruling rejecting Boeing’s anticompetitive attempt to deny U.S. airlines and the U.S. traveling public access to the state-of-the-art 110-seat CS100 aircraft when Boeing offers no viable alternative,’’ the airline said.

Boeing can appeal the decision but has yet to indicate it will do so.

The US manufacturer  said it was disappointed that the ITC did not recognize the harm it had  suffered from “the billions of dollars in illegal government subsidies that the Department of Commerce found Bombardier received and used to dump aircraft in the U.S. small single-aisle airplane market”.

“Those violations have harmed the US aerospace industry, and we are feeling the effects of those unfair business practices in the market every day.,’’ it said.

“While we disagree with the ITC’s conclusion today, we will review the Commission’s more detailed opinions in full as they are released in the coming days.

“Boeing remains confident in the facts of our case and will continue to document any harm to Boeing and our extensive US supply chain that results from illegal subsidies and dumped pricing.

“We will not stand by as Bombardier’s illegal business practices continue to harm American workers and the aerospace industry they support. Global trade only works if everyone adheres to the rules we have all agreed to. That’s a belief we will continue to defend.”