The US Department of Commerce has recommended placing a 220% tariff on imports of the Bombardier C Series. The ruling, announced on September 26, effectively triples the price of the C Series in the US. The decision came after Boeing accused its Canadian rival of selling the aircraft below cost price saying it had received state aid from Canada and the UK.
Boeing submitted a complaint to the US authorities in April claiming it had suffered financial harm after Georgia-based Delta Air Lines placed an order for 75 CS100s. Boeing claims the deal was made possible because Bombardier received “extensive government support totalling more than $3bn”.
A Boeing statement said: “The US Department of Commerce today affirmed that Bombardier has taken massive illegal subsidies in violation of existing trade law.” It added: “Subsidies enabled Bombardier to dump its product into the US market, harming aerospace workers in the United States and throughout Boeing’s global supply chain.”
Bombardier called the tariff “absurd and divorced from reality” and vowed to fight it. The Canadian manufacturer noted that the decision, and a further ruling due in October, were “preliminary” and said it was confident the International Trade Commission would find in its favour when it makes its ruling in February.
“This result underscores what we have been saying for months: the US trade laws were never intended to be used in this manner, and Boeing is seeking to use a skewed process to stifle competition and prevent US airlines and their passengers from benefiting from the C Series,” it said in a statement. “The simple truth is that Bombardier created a superior aircraft that is more efficient, more comfortable, and quieter.”
Bombardier says that Boeing doesn’t offer a rival product as it “abandoned” the 100-110 seat market “years ago”, a point backed up by Delta.
UK Prime Minister Theresa May said she was “bitterly disappointed” with the decision. Of the more than 4,000 people Bombardier employs at its plant in Belfast, where wings for the jet are produced, about 1,000 are connected to the C Series.