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World

Trudeau: Canada Could Stop Dealing with Boeing over Dispute

Canada had been in talks to purchase 18 Super Hornet fighter jets from U.S. aerospace giant Boeing

Prime Minister Justin Trudeau and British Prime Minister Theresa May walk in the Hall of Honour on Parliament Hill in Ottawa during a visit on Monday, September 18, 2017, photo: The Canadian Press via AP/Justin Tang
1 month ago

TORONTO – Canadian Prime Minister Justin Trudeau said Monday his government could stop doing business with Boeing if the U.S. company doesn’t drop a trade complaint against Canadian plane maker Bombardier.

Trudeau said that Canada “won’t do business with a company that’s busy trying to sue us and put our aerospace workers out of business.”

Canada had been in talks to purchase 18 Super Hornet fighter jets from U.S. aerospace giant Boeing, but those have been on hold because of the Bombardier dispute. Trudeau’s comments are Canada’s strongest yet.

 

Chicago-based Boeing’s complaint claims that Bombardier’s new CSeries passenger aircraft receives Canadian government subsidies that give it an advantage internationally.

The complaint prompted a U.S. Commerce Department anti-dumping investigation that could result in penalties for Bombardier. A preliminary decision is expected next week and a final decision could include financial penalties.

A Boeing spokesman did not immediately respond to an email message requesting comment.

Trudeau spoke during a news conference with British Prime Minister Theresa May.

Bombardier is also a major employer in Northern Ireland, with over 4,000 workers in Belfast. May said she brought up the issue with U.S. President Donald Trump in a telephone call recently and said she’ll reiterate Bombardier’s importance to Northern Ireland when she meets with Trump this week.

Boeing petitioned the U.S. Commerce Department and the U.S. International Trade Commissionn (ITC) to investigate subsidies of Montreal-based Bombardier’s CSeries aircraft. Boeing says Bombardier has received more than US$3 billion in government subsidies that let it engage in “predatory pricing.”

Brazil has also launched a formal complaint to the World Trade Organization (WTO) over Canadian subsidies to Bombardier. Sao Paolo-based Embraer is a fierce rival of Bombardier’s.

The Quebec government invested US$1 billion in exchange for a 49.5 percent stake in the CSeries last year. Canada’s federal government also recently provided a US$275 million loan to Bombardier, which struggled to win orders for its new medium-size plane. But Bombardier won a 75-plane order for the CSeries from U.S.-based Delta Air Lines in 2016. Bombardier said its planes never competed with Boeing in the sale to Delta.

 

The Canadian government said late last year it would enter into discussions on buying 18 Super Hornet jet fighters from Boeing on an interim basis and hold an open competition to buy more planes over the next five years. Canada remains part of Lockheed Martin’s F-35 Joint Strike Fighter program.

Canadian defense minister Harjit Sajjan previously said Boeing’s action against Bombardier is “unfounded” and not the behavior of a “trusted partner.” He said buying the Super Hornet fighter jets “requires a trusted industry partner.”

ROB GILLIES

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