Bombardier and Boeing clash in trade hearing over CSeries

Marco Green
May 20, 2017

"Boeing would prefer that airlines buy older larger aircraft based on older technology", chief executive Alain Bellemare said during the company's shareholder meeting on 11 May. Bombardier lawyers also point to Boeing's enviable backlog of products, suggesting that Boeing has not lost any revenue as a result of the alleged predatory pricing action by Bombardier. The Atlanta-based carrier will serve as the US launch airline of the 110-seat CS100 as well as Bombardier's largest C Series customer.

Boeing said in its petition that Bombardier, determined to win a key order from Delta after losing a competition at United Airlines, had offered its planes to the airline at an "absurdly low" $19.6 million each, well below what it described as the aircraft's production cost of $33.2 million. "While assuring the case is decided strictly on a full and fair assessment of the facts, we will do everything in our power to stand up for American companies and their workers".

The DoC says if the investigations determine that CSeries planes were dumped in the USA market or were unfairly subsidized, it would collect duties equal to the value of the benefits.

Bombardier said last month it worked to ensure compliance with the laws of countries where it operates and spent about $3 billion annually with American suppliers.

The Canadian government said late last year it would enter into discussions with the USA and Boeing on buying 18 Super Hornet jet fighters from Boeing on an interim basis and hold an open competition to buy more planes over the next five years.

"It is untenable for us to continue competing with government subsidized competitors" Boeing Vice Chairman Raymond L. Conner said.

Boeing has petitioned the U.S. Commerce Department and the U.S. International Trade Commission to investigate subsidies of Bombardier's CSeries aircraft that it says have allowed the company to export planes at well below cost.

"You guys can fix this before it is too late".

The preliminary ruling on the 100-150-seat planes is due by June 12. She said the government strongly disagrees with the Commerce Department's decision to initiate anti-dumping and countervailing duty investigations.

Delta's order came six months after the province of Quebec agreed to infuse $1 billion in the financially strapped C Series program, giving it a 49.5-percent stake in a limited partnership with Bombardier.

The federal government recently provided a $372.5-million loan.

Boeing's similarly sized 737-700 model has a current list price of $82.4 million, with the new 737-MAX 7 priced at $92.2 million. "If this is a case of David vs. Goliath, Boeing has cast itself in the wrong role".

"We believe this action could have a very negative impact on airlines, the travelling public... and the aerospace industry", Bellemare added, noting Bombardier employs thousands of U.S. workers and buys components from United States manufacturers.

Other reports by Click Lancashire

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