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US Dept of Commerce slaps 220% tax on Bombardier c series

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US Dept of Commerce slaps 220% tax on Bombardier c series

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Old 17th Oct 2017, 19:50
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Originally Posted by MartinAOA
With that in mind it's easy to "justify" their losses with the A380, etc. ...
I'm a bit intrigued about the 'etc' bit. It's no secret Airbus has received launch aid for every single product it has brought to market. It's also no secret, the aid was to be repaid with interest, and that every frame sold would earn the lender a royalty.

To my knowledge the governments which provided launch aid have made not just a little, but very considerate amounts of money on Airbus on every single program except the original A300 and the A380, and that those profits vastly outstrip the 'losses' on the A300 and A380. I've put losses in brackets, as it doesn't really apply to the A300, without which there'd be no Airbus. So whilst that program may have been at a loss, it launched a company where the cumulative profits are far, far higher than that loss.

But, please, do go ahead and elaborate.
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Old 17th Oct 2017, 19:52
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Back to the topic at hand, I find it interesting that Delta believes they have a route structure that this C class aircraft will fit into for their business model, and apparently other airlines do not, as of yet?

Any ideas on what's behind that?
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Old 17th Oct 2017, 20:47
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Maybe Delta simply want to differentiate themselves from the other US airlines. If it flies far enough and carries the right number of passengers, the comfort, quietness and fuel efficiency has got to count as pluses.
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Old 17th Oct 2017, 20:55
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Originally Posted by Lonewolf_50
Any ideas on what's behind that?
"Delta Air Lines Inc. is eyeing New York and Los Angeles as the main bases for Bombardier Inc.’s new jetliner next year, offering a glimpse of how carriers can add service economically with the midsize plane. Dallas is also likely to get a lot of C Series flights, Delta said in an internal memo to pilots, a copy of which was reviewed by Bloomberg News. That sets up a test of the carrier’s ability to use the single-aisle aircraft to attract customers in the backyard of American Airlines Group Inc. and Southwest Airlines Co."

https://www.bloomberg.com/news/artic...n-l-a-new-york

https://www.flightglobal.com/news/ar...w-york-439306/
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Old 17th Oct 2017, 20:56
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At a guess, few airlines have wished to bank on the viability of the programme. It's been fraught with difficulties almost since inception, making it a bit of gamble. Since most airlines are extremely cautious of risk, that's probably the main reason it hasn't sold more than the 300 odd copies it has.

Why Delta sprung for it is probably a simple question of arithmetic, opportunity and need; Delta perceived a need for something around 100 seats, the C-series is just about the only game in town and BBD offered some very intriguing numbers, backed by their desperation to break into the US market with a major.
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Old 18th Oct 2017, 06:21
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"US-built CSeries still subject to import tax: Boeing"

https://www.flightglobal.com/news/ar...boeing-442258/
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Old 18th Oct 2017, 07:14
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Well, they would say that wouldn't they? I can't think what else Boeing can say about the matter. It's also largely irrelevant. Airbus clearly have global ambitions for the C Series, the US market would simply be a nice extra. If Boeing ends up being restricted to just the US market (that being the only place they may find themselves able to sell a 60 year old design), that's a big win for AirBardier.

Given that the formal process of deciding whether or not the tariff will actually be applied has not been completed, it's still too early to say. The US has concluded that there was state aid. Now they have to decide whether or not Boeing were "damaged" by that state aid. Given that Boeing has nothing in the same class in its airplane catalogue, it's still entirety possible that the tariff won't be applied at all. That'd be bad news for Boeing.
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Old 18th Oct 2017, 10:53
  #208 (permalink)  
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Differing corporate cultures. I wonder if this pleasant tribute from Airbus to Boeing just went completely over their heads. Is it a European thing ?

https://www.youtube.com/watch?v=lTmri6E8Xzk
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Old 18th Oct 2017, 12:00
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Love the Airbus approach to congratulate Boeings centenary.

Looks like Airbus are confident and relaxed and have Boeing on the ropes .. lol
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Old 18th Oct 2017, 12:22
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I'm sure we'll see a similarly glowing tribute from Boeing on Airbus's centenary in 53 years time.

Oh, hang on ...
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Old 18th Oct 2017, 13:07
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In its complaint, Boeing claims that Bombardier sold the CS100 for just $19.6 million. That's far less than the $33.2 million the Chicago-based aviation giant says it cost Bombardier to make the plane and a mere fraction of the CS100's $79.5 million sticker price. As a result, Boeing claims the Montreal-based company is dumping its product on the US market to the detriment of US aviation workers.

That is the foundation of the complaint, (and the 300% levy) not the $1 Billion bailout from the govt.

In addition:

Looking for a blockbuster sale to help build traction for the plane in the US, Bombardier went all in on a pitch to United Airlines. Sensing the new competition, Boeing gave United a whopping 70% discount on the 40 737-700s. While large airlines like United never pay list price, 70% off is the aviation equivalent of a Black Friday sale price.

Dumping? Paying 30% of list vs paying 25% of list...

What it all really means: Instead of keeping the Canadian jet grounded, Boeing pushed C Series into the arms of its greatest rival.

Last edited by underfire; 18th Oct 2017 at 13:24.
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Old 18th Oct 2017, 18:47
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Boeing have started advertising to Canadians both in the MSM and on-line to try to repair the PR damage they have done to themselves.

It isn't going to work. Canadians are well aware of what Boeing has done here because it has been widely reported on all media. It will be politically difficult now for the government to purchase products from Boeing, and the major carriers might think twice about their next purchase.
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Old 18th Oct 2017, 19:05
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Originally Posted by dash34
It will be politically difficult now for the government to purchase products from Boeing, and the major carriers might think twice about their next purchase.
LOL... They better not contact me because I'll tell them where to stick it!

Also both WestJet and Air Canada are going to be delivered new 737s and some 787s and I think if this government had any balls they would slap a 300% import tax on those imports too.
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Old 18th Oct 2017, 20:28
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Originally Posted by Jet Jockey A4
LOL... They better not contact me because I'll tell them where to stick it!
Boeing have today launched a sudden PR campaign across Canada, having realised the enormous reputational damage their overzealous lawyers have done to the company image.

Boeing Launches Outreach Campaign in Canada

From what Trudeau has said, though, it's the end though for further consideration of the Boeing military fighters.

"We have obviously been looking at the Super Hornet aircraft from Boeing as a potential significant procurement of our new fighter jets," Trudeau said on Parliament Hill last month.

"But we won't do business with a company that's busy trying to sue us and trying to put our aerospace workers out of business."
As trade irritants pile up, Trudeau calls Trump to sell Bombardier-Airbus deal - Politics - CBC News
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Old 18th Oct 2017, 21:43
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This is the payoff for 150 years of non-stop trade bullying.

Americans need to learn there is a price to be paid for egregious behaviour.
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Old 18th Oct 2017, 21:46
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Originally Posted by Jet Jockey A4
LOL... They better not contact me because I'll tell them where to stick it!

Also both WestJet and Air Canada are going to be delivered new 737s and some 787s and I think if this government had any balls they would slap a 300% import tax on those imports too.
As much fun as that would be, Canada does not produce anything in those classes so we could not prove "economic harm".
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Old 19th Oct 2017, 00:15
  #217 (permalink)  
 
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Well the reverse is also true... Boeing does not produce an aircraft in the C Series class.
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Old 19th Oct 2017, 01:11
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Ummm, ..... that has been the point from the very beginning.
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Old 19th Oct 2017, 05:29
  #219 (permalink)  
 
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I assume the poster meant it like this; The point being that if that US DOC 300% will stand, it should be no problem to raise the same kind of tariff against those 737/787 orders, baseless or not.
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Old 19th Oct 2017, 06:39
  #220 (permalink)  
 
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Here's the essence of the supreme arrogance in US 'dumping' law:

If a foreign company sells below cost, it's dumping and liable to tariffs.
If a US company sells below cost, that's fine - move along, nothing to see here.

I'm sure there's logic in there somewhere, but one would probably need to be a particularly vulturous lawyer to see it.
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