USA confirms punitive tariffs of almost 300% on Bombardier planes

Alicia Cross
December 22, 2017

The U.S. Commerce Department on Wednesday finalized duties of almost 300 percent on passenger jets made by Bombardier, a win for Boeing, which lodged the complaint against its Canadian rival.

An global row between the US and Canada has kicked off again as the US Department of Commerce upheld massive tariffs on the import of Bombardier's C Series jet.

The fight, which has contributed to escalating trade tensions between the U.S. and Canada, stems from a 2016 sale of 75 C-Series jets to Delta Air Lines.

The International Trade Commission will make its final injury determination by February 1, and if injury is found, Commerce will issue AD and CVD orders. But the panel also appeared dubious about Bombardier's claims that the CSeries and the smallest versions of the 737 do not compete against each other at all.

"These investigations have already established beyond question that Bombardier has taken billions of dollars in illegal government subsidies to prop up its C Series program".

"Today's decision validates Boeing's complaints regarding Bombardier's pricing in the United States, pricing that has harmed our workforce and USA industry", Boeing said in a statement.

"Today's decision validates Boeing's complaints regarding Bombardier's pricing in the United States, pricing that has harmed our workforce and USA industry", it added.

"The fact is that the CSeries simply does not threaten Boeing", Bombardier said in a statement.

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"Boeing's assertion that future imports from Canada threaten to cause material injury is necessarily based on just the type of "speculation and conjecture" that is prohibited under both USA and worldwide law", MacNaughton told the panel.

The Commerce Department's decision comes as the Trump Administration takes a hard line on trade practices it views as hurting American workers.

European planemaker Airbus SE, which is buying a controlling stake in the CSeries program and has a competing plane, has said it would add a second CSeries production line to a factory in Alabama, making it a USA product for domestic airlines. The trade dispute stems from a complaint by USA aerospace giant Boeing against its Canadian rival that found a receptive ear in President Donald Trump, whose "America First" agenda has included taking a tough line in matters of worldwide commerce.

Boeing says that should not negate the duties because Airbus and Bombardier would import fuselages and wings and merely be assembling in the United States.

It includes a 79.82% tariff to offset a Commerce Department ruling that Bombardier engaged in price dumping, meaning it sold the CS100s to Delta below its fair market value by that amount.

US and Mexican trade officials will meet next month in Canada to continue NAFTA talks.

The tariff will apply "regardless of whether they enter the United States fully or partially assembled", the Commerce Department says.

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