Bombardier slapped with greater US tariffs in Boeing row as UK raises protectionist concerns

 
Rebecca Smith
Bombardier is embroiled in a row with rival Boeing
Bombardier is embroiled in a row with rival Boeing (Source: Getty)

The Bombardier tariff row has been taken up a notch after the US Department of Commerce has ruled again in favour of US rival Boeing.

A further 80 per cent tariff has been imposed on the import of Bombardier's C Series jet to the US, after Boeing had complained the Canadian firm had been dumping aircraft in the US market.

The hit is on top of an earlier tariff of nearly 220 per cent, relating to subsidies Bombardier received from Canada and the UK.

Read more: Theresa May warns Boeing over undermining its relationship with Britain

It comes amid concerns raised in the UK that the decision is signalling a more protectionist stance from the US. The chair of the International Trade Committee this week wrote to the secretary of state for greater clarity on the Bombardier situation, asking whether the decision suggests the US "is taking a more protectionist stance to international trade".

Chair Angus MacNeil raised his concerns in a letter to Liam Fox, saying the decision was "entirely prohibitive to trade".

Bombardier has said it strongly disagrees with the preliminary decision, with a final ruling in the case due next year. It said the Department's approach throughout the investigation "has completely ignored aerospace industry realities".

Bombardier said:

Boeing's own programme cost accounting practices - selling aircraft below production costs for years after launching a program - would fail under Commerce's approach. This hypocrisy is appalling, and it should be deeply troubling to any importer of large, complex, and highly engineered products.

In a statement, Boeing said the Department of Commerce had "affirmed the magnitude to which Bombardier has dumped C Series aircraft in the United States, selling those aircraft at prices millions below production cost in an illegal effort to grab market share in the US single-aisle airplane market".

The row has caused concerns over jobs in the UK, with Bombardier employing some 4,000 people in Northern Ireland. Unions have expressed worries that hefty tariffs will put off Bombardier from staying there at all.

And the UK government has been vocal in its criticism of the decision, warning that it could jeopardise future deals with Boeing.

Last month, defence secretary Michael 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."

The American firm has said the row had nothing to do with limiting competition, but was focused on maintaining a level playing field.

Read more: Trade committee chair seeks answers over Bombardier tariff row

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