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28 January 2018, 12:08 | Maryann Sutton
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Bombardier Inc.'s marquee jet, slapped with crushing USA tariffs previous year, got a new lease on life when an American trade panel nixed the duties.
MONTREAL-The heated battle between Boeing Co. and Bombardier Inc. over C Series sales in the United States will likely drag on regardless which side comes up short January 26 in a U.S. International Trade Commission ruling. The duties were imposed by the Department of Commerce late a year ago after Boeing launched a claim alleging the CSeries were being dumped on the USA market at below-market prices in a deal with Delta Air Lines for 75 aircraft.
But Bombardier hailed the decision as "a victory for innovation, competition and the rule of law".
Boeing had claimed Bombardier was able to sell the aircraft at "absurdly low prices" in the US after receiving $3 billion in government subsidies.
For its part, Bombardier, which sold a majority stake in its CSeries project to Boeing nemesis Airbus, said that the partners intend to proceed with building a final assembly line for the planes at the Airbus plant in Mobile, Alabama.
The ruling is welcome news for Bombardier's 1,000 employees in the North, and means the airline can start shipping its CSeries jets to Delta Air Lines as scheduled.
"Common sense should now trump because there's absolutely no reason now for the C Series to satisfy the USA market be built in Mobile, Ala", Unifor president Jerry Dias told reporters.
The ITC is an independent commission, appointed by the government and evenly split between Democrats and Republicans, that is charged with investigating the effects on US industry of dumped and subsidized imports.
"Delta is pleased by the U.S. International Trade Commission's ruling rejecting Boeing's anti-competitive attempt to deny U.S. airlines and the U.S. travelling public access to the state-of-the-art 110-seat CS100 aircraft when Boeing offers no viable alternative", it said in a news release.
The trade dispute has spilled over to Boeing's customers.
"The ITC has done a thorough and good job of recognizing the interconnected nature of aerospace manufacturing today", she wrote.
"The decision by the International Trade Commission confirms what the United Kingdom and Canadian Governments working hand in hand has [sic] maintained from the outset, that this case is unjustified", said U.K. Business Secretary Greg Clark in a statement. Bombardier says that will create more than 2,000 permanent U.S.jobs. "It in no way should be interpreted as a broad-scale limitation on the Trump administration's trade enforcement authority".
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.
Bombardier shares spiked 19 per cent on the news to $3.67. It is also a victory for U.S. airlines and the USA travelling public. Executives say they are concerned about Boeing's competitive position as Airbus expands its offering of planes through the planned tie with Bombardier. "That's why Bombardier is willing to lose millions of dollars per plane on this sale". "We expect that with the building of a USA assembly plant, the whole trade dispute will be irrelevant".
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