Bombardier circumvents tariff hike with Airbus stake deal

Thursday, 17 Oct, 2017 0

The US-Canada trade dispute involving plane makers Boeing and Bombardier has taken a new twist with the emergence of Airbus on the scene.

Airbus is taking a majority stake in a joint venture to market Bombardier’s CSeries jets.

The CSeries is at the heart of a trade dispute between the US and Canada over alleged ‘dumping’ of the aircraft in the US at ‘absurdly low prices.’

A complaint by Boeing sparked the US to impose a provisional 300% tariff hike in a move threatening to overshadow NAFTA talks.

The Bombardier and Airbus tie-up will see the aircraft assembled at Airbus’ Mobile, AL plant but will not impact jobs in Canada.

Airbus CEO Tom Enders said by using the Alabama plant, the 300% tariff is dead in the water.

It would now be deemed as a domestically manufactured product, and has already enflamed Boeing.

"This looks like a questionable deal between two heavily state-subsidized competitors to skirt the recent findings of the U.S. government," Boeing said in a statement.

Canadian Innovation Minister Navdeep Bains said the JV still needs to be scrutinized under the country’s foreign-investment laws but looks like it ‘would help position the CSeries for success by combining excellence in innovation with increased market access and an unrivaled global sales force.’

Airbus and Bombardier first discussed teaming up for the CSeries project more than two years ago but now ‘this was the right time,’ Enders said.

TravelMole Editorial Team

Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.

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