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Bombardier expects scrutiny about trade complaints at Paris air show

Trade complaint lodged by Boeing expected to be the talk of the four day event.


June 16, 2017
The Canadian Press
by Ross Marowits

MONTREAL — Bombardier is steeling itself for scrutiny at the International Paris Air Show next week about its disputes with Brazil and rival aircraft manufacturer Boeing over its signature CSeries passenger jets.

Fred Cromer, head of Bombardier’s commercial aircraft division, said he expects potential CSeries customers will pepper the company with questions at one of the airline industry’s marquee marketing events of the year.

But Cromer said the trade actions do not overshadow the aircraft’s performance, which he said is exceeding expectations in service with Swiss International Air Lines and airBaltic.

“The clients themselves have seen these kinds of complaints come and go in the past,” he said. “I think they continue to stay focused on what is the right airplane is for them.”

In April, Boeing petitioned the US Commerce Department and US International Trade Commission alleging that the Montreal company has been selling CSeries planes in the US below cost thanks to public subsidies in violation of trade rules. Brazil had filed a similar complaint before the World Trade Organization months earlier.

The US could impose duties on the sale of CSeries, making it difficult for Bombardier to sell the planes south of the border.

Cromer said Boeing’s challenge hasn’t slowed down Bombardier’s sales efforts or steered it more towards customers in Europe or Asia.

It’s been half a year since Bombardier sold a CSeries plane. The last order, for two aircraft, came in December from Tanzania, raising the number of firm orders to 360.

Richard Aboulafia, vice-president of analysis at aerospace consulting firm Teal Group, said he expects Bombardier to put on a “brave face” at the four-day air show.

“It will be the talk of the show,” he said of the clash between Bombardier and Boeing. “Will it have any material impact? I doubt it.”

Cromer wouldn’t predict whether Bombardier would receive new CSeries orders at the show, but even if they do, industry analysts aren’t expecting any sizable deals.

The Bombardier-Boeing dogfight has also taken on a political dimension. The federal government recently said it is reviewing bids from the Chicago-based company for military contracts, a hint that Ottawa may be reconsidering its purchase of Boeing’s Super Hornets.

Federal Defence Department officials will meet at the Paris air show with representatives of other fighter jet makers before launching a bidding competition to replace Canada’s aging CF-18 fleet with 88 new fighter jets.

Bombardier received about $3.7 billion in total in the last year from the Quebec and Canadian governments as well as Quebec pension fund manager the Caisse de depot. That funding is at the heart of Boeing’s complaint, which Bombardier has rejected as groundless.

News from © Canadian Press Enterprises Inc. 2016

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