Increase in US tariff on Bombardier plane shows up Theresa May’s diminishing influence
A Bombardier C-series jet, part of the Delta airline fleet.
Could anything demonstrate the UK’s diminishing influence on the international stage – entirely due to the Conservative government – than the US tariff on Bombardier planes?
This Site reported when the US government slapped its original 220 per cent tariff on Bombardier, in a move that seemed intended to serve notice on the UK that leaving the EU will destroy our aerospace industry altogether.
It seems Theresa May’s government has been in touch with the States about it – and what happened?
Have I misheard #r4
US NOW slapped 300% tariff on Bombardier !
220% was punishing enough
Thought you were gonna have a *word* Theresa ?— Clare Hepworth OBE (@Hepworthclare) October 7, 2017
The new tariff has been a gift for the Labour Party. Here‘s Owen Smith, Shadow Northern Ireland Secretary, making the obvious points:
“While Theresa May worries about press coverage of the phony P45 she was handed this week, more than 4,000 Bombardier workers in Belfast are worried that they’ll receive a real one unless her Government brings Boeing and its allies at the US Commerce Department to the negotiating table.
“Given that the UK Government is Boeing’s second biggest client – we spend over £1.5 billion with them every year – it is inconceivable that ministers have not been able to negotiate a better deal.
“The Government must tell the public what pressure it has really placed on Boeing and on the US Administration. Without any evidence of concrete action, concerns will grow that UK ministers have naively accepted Boeing’s assurances about the safety of jobs in Belfast or worse, have negligently accepted Bombardier job losses as ‘collateral damage’ in their post-Brexit strategy.”
The US Department of Commerce has again ruled against aerospace firm Bombardier in its dispute with rival Boeing.
A further tariff of 80% has been imposed on the import of Bombardier’s C-Series jet to the US for alleged below-cost selling.
This is on top of an earlier tariff of 220% which related to subsidies Bombardier got from Canada and the UK.
There have been warnings that the import tariffs could threaten Bombardier jobs in Belfast.
About 1,000 jobs are linked to the C-Series, the wings of which are made at a purpose-built £520m factory in the city.
Source: Further tariff of 80% imposed on import of C-Series plane – BBC News
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This does not bode well for T May’s Brexit assertions. How many other organisations have ‘subsidies’ ? If this were vis-a-vis then the USA would have declared a trade war by now.
Excellent piece, Mike. A final decision on the tariffs will be made by the International Trade Commission, a quasi-judicial U.S. government agency. That ruling is expected in February.
Bombardier is headquartered in Montreal, where I reside. Here’s their latest press release: Press releases – Bombardier Inc. Investor Relations http://ir.bombardier.com/en/press-releases/press-releases/71596-statement-on-commerce-department-antidumping-duties-preliminary-decision.
Furthermore the Boeing/Us case is very, very slim: 1) Aerospace companies in USA might not get “Direct” subsidies from their Government, but since the early days of mass produced planes they have benefitted HUGELY from all manner of government rebates, concessions, tax breaks (national and local) “development”, “relocation”, “re-training” grants etc.. Then there is the military work: tens of thousands of military aircraft made by Boeing and other makers, going straight from factory to desert storage and eventual scrapping. They are not needed by the military at time of order, but paid for to keep the factories busy and profitable.
Then there were two other HUGE “subsidies” to US plane, ship, arms and vehicle manufacturers. In WW1 UK paid the bill for US help, including all those land, sea and air vehicles and arms. Were were still paying this bill when WW2 started and we had to pay top dollar for every single item we bought from them, and countless times what we received was NOT the high quality products for the US forces, but the rejects : ships which did not work or exploded, old stuff tarted up, poor quality licence-produced versions. Before WW1 was still a relatively small power and mostly a poor and relatively backward country. By the end of WW2 they were extremely wealthy and the world’s greatest power. They even got our Radar, Jet engines, advanced aeronautics and computers for FREE to improve their aeroplanes and ships.
Perhaps most important of all, “Free Trade” and “Unfair Competition” – which is what Boeing’s complaint is mostly claiming to be about – the Bombardier was very specially designed to fit a niche market for which Boeing does not make anything at all comparable!
https://uk.reuters.com/article/uk-wto-aircraft/wto-reverses-boeing-777x-tax-credit-ruling-in-blow-to-eu-idUKKCN1BF1PW