Saturday, 17 November, 2018

Relief for 1000 workers in Belfast as USA jet tariff overturned

ITC rejects Bombardier's request to review Embraer range Ruling Due In Boeing Trade Spat; Trump At Davos: Investing Action Plan
Kelvin Reese | 28 January, 2018, 00:12

Bombardier has won a trade dispute in the United States, in a surprise ruling that could potentially save thousands of jobs in Northern Ireland.

That means the nearly 300 percent crippling duty imposed by the U.S. Department of Commerce will not be applied.

Bombardier said in a statement: "Today's decision is a victory for innovation, competition, and the rule of law".

The US manufacturer said it would review the USITC's more detailed opinions in full as they are released in the coming days.

Boeing also claimed that Bombardier was guilty of "dumping" the aircraft in the US market by selling 75 of the jets to Delta in 2016 at a very low price.

A Bombardier and Airbus partnership will include the construction of a new USA manufacturing facility in Alabama for the assembly of the C Series.

Boeing said it would "continue to document any harm to Boeing and our extensive US supply chain that results from illegal subsidies and dumped pricing".

The decision means Bombardier can make deliveries to Delta Air Lines Inc.

The case came mostly in response to steep tariffs the Trump administration has levied on Canada's softwood lumber industry, which is vital to USA home building. The company has been able to keep the price down, the department said, because of unfair Canadian government subsidies.

In September, the Commerce Department proposed a tariff of 219.6% on the Canadian jets, then added an additional 79.8% tariff the following month.

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The U.S. International Trade Commission voted 4-0 against Boeing, which initially launched the petition against the Montreal plane and trainmaker arguing it had dumped its marquee jet into the U.S. market and offered it to Delta Air Lines Ltd.

"Boeing's previous attempts to exclude Embraer from the ITC's analysis has resulted in a fundamentally flawed assessment of the market that we believe needs to be addressed", he wrote in an email.

The trade court said it hadn't found Boeing was materially harmed by Bombardier's trade practices.

"When you look at it as an industry analyst, this seems to be the right decision - that Boeing was not hurt by the C Series and Delta's decision to buy it, particularly in light of Airbus's taking over the ownership of C Series and building it in Alabama".

The chief executives of Bombardier and Airbus were meeting Friday in Montreal to discuss the integration of the two plane makers.

Paul Everitt, chief executive of aerospace trade organisation ADS said: "This judgement from the US International Trade Commission is positive news that will be warmly welcomed by Bombardier, its workforce in Belfast and the whole supply chain of companies in the United Kingdom and Ireland".

Prime Minister Theresa May, who raised the issue with US President Donald Trump at the World Economic Forum in Davos, Switzerland, said: "I welcome this decision, which is good news for British industry".

It had been expected that Boeing would win the day based on its claim that the C-Series had been unfairly subsidised by the Canadian government.

And the severe pressure on Bombardier helped seal its decision to sell a majority stake in the CSeries to Boeing's archrival, Airbus.

"Yes, we will proceed with the Alabama [final assembly line]".

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