Bombardier faces 300% tariff on US exports
The fresh levy was proposed by the US government amid an international trade dispute.
Last updated 7th Oct 2017
One of Northern Ireland's largest employers is facing a proposed 300% duty on its exports of planes to the US.
A second preliminary levy of 80% has been loaded on the sales of aerospace manufacturer Bombardier.
The Canadian-owned multinational is already facing a planned 220% tariff on its aircraft as part of a separate investigation, the US Department of Commerce confirmed.
Bombardier employs more than 4,000 people at its Belfast factories and is due to begin delivering a blockbuster order for up to 125 new jets to Atlanta-based Delta Airlines next year.
US commerce secretary Wilbur Ross said: "The United States is committed to free, fair and reciprocal trade with Canada, but this is not our idea of a properly functioning trading relationship.
"We will continue to verify the accuracy of this decision, while doing everything in our power to stand up for American companies and their workers."
Prime Minister Theresa May had lobbied President Donald Trump over the dispute sparked by complaints from rival Boeing that Bombardier received unfair state subsidies from the UK and Canada, allowing the sale of airliners at below cost prices in the US.
Commercial aircraft programs require billions in initial investment and years to provide a return on that investment. By limiting its antidumping investigation to a short 12-month period at the very beginning of the C Series program, Commerce has taken a path that inevitably would result in a deeply distorted finding.
Unions have warned thousands of jobs could be in jeopardy.
"We remain confident that, at the end of the processes, the U.S. International Trade Commission will reach the right conclusion, which is that the C Series benefits the U.S. aerospace industry and Boeing suffered no injury.
"There is wide consensus within the industry on this matter, and a growing chorus of voices, including airlines, consumer groups, trade experts, and many others that have come forward to express grave concerns with Boeing’s attempt to force U.S. airlines to buy less efficient planes with configurations they do not want and economics that do not deliver value."
The US government said its intervention was prompted by concern to prevent 'injurious dumping'' of imports into the country, 'establishing an opportunity to compete on a level playing field'.'
The U.S. government should reject Boeing’s attempt to tilt the playing field unfairly in its favor and to impose an indirect tax on the flying public through unjustified import tariffs.
The Commerce Department said Bombardier had failed to provide information requested.
Commerce’s statement that Bombardier is not cooperating with the investigation is a disingenuous attempt to distract from the agency’s misguided focus on hypothetical production costs and sales prices for aircraft that will be imported into the United States far in the future.
It added: "The antidumping duty law provides US businesses and workers with a transparent, quasi-judicial, and internationally accepted mechanism to seek relief from the market-distorting effects caused by injurious dumping of imports into the United States.''
Dumping means the export of a product at a lower price.
The US government preliminary decision affects imports of 100-150 aircraft from Canada.
The department said it will instruct US Customs and Border Protection to collect cash deposits of duties.
In a statement released late on Friday, the firm criticised the proposed ruling:
"We strongly disagree with the Commerce Department’s preliminary decision.
"It represents an egregious overreach and misapplication of the U.S. trade laws in an apparent attempt to block the C Series aircraft from entering the U.S. market, irrespective of the negative impacts to the U.S. aerospace industry, U.S. jobs, U.S. airlines, and the U.S. flying public.
"The Commerce Department’s approach throughout this investigation has completely ignored aerospace industry realities.
"Boeing’s own program cost accounting practices – selling aircraft below production costs for years after launching a program – would fail under Commerce’s approach.
"This hypocrisy is appalling, and it should be deeply troubling to any importer of large, complex, and highly engineered products."