Defence secretary Michael Fallon warns Bombardier row could jeopardise future Boeing deals


The defence secretary has hit back at the tariffs imposed on Bombardier (Source: Getty)

Defence secretary Michael Fallon warned today that the US tariffs imposed on Bombardier yesterday in a row with Boeing could jeopardise the UK's future relationship with the American firm.

Fallon became the latest politician to hit out at the Bombardier tariffs brought in by America's Department of Commerce yesterday, after it made a preliminary finding that the Canadian firm had received unfair state subsidies and sold its CSeries jet below cost.

Read more: Theresa May 'bitterly disappointed' over Bombardier tariffs in Boeing feud

Boeing said the dispute had "nothing to do with limiting innovation or competition", and was instead to do with "maintaining a level playing field and ensuring that aerospace companies abide by trade agreements".

But concerns have been raised in the UK that thousands of jobs will be put at risk by the ruling.

And speaking to reporters in Belfast today, Fallon said: "This is not the behaviour we expect from Boeing and it could indeed jeopardise our future relationship with them."

Boeing has significant defence contracts with us and still expects to win further contracts. Boeing wants, and we want, a long-term partnership, but that has to be two-way.

However, aerospace analyst Howard Wheeldon said: "Threats by both the Canadian and British Prime Ministers to halt purchase of Boeing military planes unless the dispute can be sorted out are hardly conducive to finding a satisfactory way out of the current impasse. They are as pointless as they are seen by most as merely political posturing."

Boeing said in a statement: 

We have heard and understand the Prime Minister’s concerns about Bombardier workers in Northern Ireland.

The company has doubled its direct employment in the UK since 2011 and tripled its spending with more than 250 companies in the UK supply chain over the same period, to £2.1bn in 2016.

We are pleased to work with our partners, including the British government, and provide such a vote of confidence in the UK.

Trade unions have warned that tariffs could make Bombardier question whether to stay in Northern Ireland, where it employs over 4,000 people.

The effect could be wider too, as the firm in Belfast has an overall supply chain of around 800 firms in the UK and Ireland, according to trade body ADS.

The Prime Minister also spoke about the decision, saying earlier that she was "bitterly disappointed" and would work with Bombardier "to protect vital jobs for Northern Ireland".

Shadow Northern Ireland secretary Owen Smith however, criticised the government for the development, saying on Twitter that it had been "criminally negligent" in failing to force withdrawal of the action by Boeing.

The Labour MP also warned that arranging a new trade deal with the US in the wake of Brexit will not be smooth sailing.

The US International Trade Commission will consider the case ahead of a final ruling in February.

Read more: Bombardier faces 219 per cent tariff after losing battle in trade war