UK Joins Canada Against Boeing Over Bombardier Investigation File


Update in this morning’s newspaper (The Globe & Mail).



Another update.


Here’s an opinion article on the situation.
What’s your take on the article? Why?


First of all, I am just a guy sitting in my bed reading this article. I am no expert on this subject and am not a figure of authority when it comes to this.

First impressions, the airticle is clearly biased.
Second, and I think the main problem with this article, is that it is misinterpreting this as an attack on Canada, its aviation industry and its people. Boeing isn’t doing that, Boeing is claiming that Bombardier did something illegal and should be investigated for it.


Preliminary ruling form US Department of Commerce and US International Trade Commission on their investigation with Bombardier today, although decision may not become public until tomorrow. If the US Department of Commerce and USITC finds that Bombardier indeed benefited from these subsidies, then Delta will have to play taxes for the CS100, every one of them. Boeing wants to slap 80% duties on the CS100’s.


Ruling on Bombardier coming soon.

They have been many sources I have seen (not all Canadian) saying that Boeing case against Bombardier is suggestion hypocrisy, as Boeing has received subsidies from the US Gov’t too.


Bombardier shares have jumped 14% before US court ruling.
Does this mean anything?


Bombardier shares have jumped 14% before US court ruling.
Does this mean anything?


The decision has been announced, an interim tariff of 219.63% has been recommended against Bombardier. Now, the lengthy appeals process will not begin until February when the US International Trade Commission announces its formal ruling.


The US has slapped duties of up to 220% (gee that’s a lot) on Bombardier. The duties will not have to be paid until first CS100 is delivered to Delta in the spring. This is a DOUBLE blow to Bombardier today, as Siemens has decided to merge with Alstom as opposed to Bombardier Rail. This will be a massive impact on Bombardier.

Is this hypocrisy or not, on Boeings side?


Okay so it seems like you guys actually know about this.
I read both articles, and did my best to comprehend. So this basically means that there is a 200% tariff on each plane that is delivered to Delta?
I also understand that the final decision is going to be made next year.

What I don’t understand is what Justin Trudeau is saying. Surely he can let justice deal with it and determine the right thing to do, right?

People who actually know about this please correct me if I’m wrong.


Yes, so if the purchase price is $19.4 million, the proposed final price will be $19,400,000+2($19,400,000) = $58,200,000

The actual situation is a lot more complicated than that. The US Department of international trade has the authority to impose tariffs unilaterally and enforce said tariff. They are legally an “authority”. But then we also need to consider the NAFTA arbitration panel and the WTO, who also legally have “authority” and can overturn the US ruling, but their decisions can be essentially ignored by the US (softwood lumber disputes).

So when you mention the word “justice”, it can refer to a myriad of different organizations who all can’t legally enforce their “decisions” on each other other than the US Department of international trade imposing tariffs on Bombardier. Most of the time, they ignore each other. There isn’t much any of those organizations can do other than sit around and hope someone follows their decision for whatever reason. NAFTA and the WTO are essentially toothless tigers considering the United State’s record of ignoring trade rulings.

So, how does the Canadian government make the US notice? Cancelling a $5.2 billion government procurement deal might do the trick, or impose some tariffs themselves and them promising to remove them if the US removes their tariff. When it comes to international trade, it’s all politics and not much “justice”.

Yes, it’s screwed up, but that’s international trade for ya.


Delta could get creative here and set up a puppet subsidary company based and registered in Canada. Let’s call it Delta Canada.
This company puts the CS100s on the Canadian C- register, and leases out the aircraft to Delta “USA”.

They could sell the newly delivered aircraft from this new Canadian / non US company to a more established European leasing company, such as Aercap, and lease them back (This is known as sale and lease back, and is common practice).

Or, if they wanted a more blatant tactic, Delta have the aircraft “sold and delivered” to a separate friendly, yet external company, and this company in turn sells the aircraft back to Delta for $1 as a pre owned aircraft - import taxes on something “worth” a dollar would be minuscule.

Multiple options here if they want to be devious, some will upset the trade lawyers more than others…
I don’t see the order being at risk, Delta have many options.


In response to this I’ll post this article about how NAFTA could save the CSeries.
At the end of the day NAFTA can overrule, yes OVERRULE, the US Department of Commerce’s ruling. Canada has previously used Chapter 19 to get tariffs taken off of lumber in the past.


Boeing shouldnt think that they owe the aviation market. Even though that they are the most prestigious manufacturer, others like Airbus, Bombardier and Embraer should be more recognised. Boeing should have respected Bombardier. Its nice to see that Boeing isnt the absolute winner. Well, i know that boeing fanboys Will hate me for this, but go ahead, insult me


No, I’m not going to insult you, but I will say your argument is very one sided. Boeing is accurate when they say Bombardier is selling suspiciously low. To be exact, it is 75% lower than what they marketed.


To be fair, Boeing sells their planes for over 70% off. Air Canada’s latest 777-300ERs sold for $125 million when list price is $320 million, those planes are now probably going for around $100 million now. List prices are just for show, it reflects in no way what the actual prices are.


But the tariffs levied have not been repaid, as long as the US government retains the tariffs collected, someone had paid the tariffs and have not gotten their money back.

This is much more realistic, that is something that can be done. We just need someone to set up an LLC in Ireland or something and that should be solved. Now, the US can just impose sanctions on those planes as well, but we still need to wait for the final ruling to see how Bombardier and Delta should proceed.


How many times am I going to have to say this…
This is not about respect. This is not about bullying. This is not about childishness.
It is an allegation that a company did something illegal. Whether it is illegal or not is another topic, but the size of a company is not worth a thing when it comes to deciding whether they did something illegal or not.