Boeing in holding pattern, awaiting rationale for big Bombardier tariff victory
by Ross Marowits, The Canadian Press
New trade challenges against the Canadian plane maker and Boeing's possible Embraer acquisition appear to be on hold until the ITC explains its ruling
The American plane maker is awaiting the U.S. International Trade Commission’s written reasons for siding with Bombardier. PHOTO: Boeing
MONTREAL—Aircraft giant Boeing Co. will wait for the U.S. International Trade Commission to publish the reasons for its trade dispute decision favouring Bombardier before deciding next steps, including whether to launch a new petition, its chief executive said Jan. 31.
“Until we see the details of that ruling, we simply don’t know the rationale behind it. So more to come when we determine that, Dennis Muilenburg said during a quarterly conference call.
Muilenburg didn’t respond directly when asked by reporters if he felt Boeing lost the decision because it didn’t have a plane competing in the campaign for Delta Air Lines, Inc., which ultimately ordered 75 CS100 C Series planes in 2016.
He was also asked if Boeing would file a new trade complaint if Bombardier sells the larger CS300 to U.S. airlines and whether its efforts to acquire Embraer will counter the tie-up between Airbus and Bombardier.
Embraer is preparing to offer a E190 E2 aircraft that is better positioned to compete with the C Series.
Bombardier and Airbus say they are planning to build a C Series assembly line in Mobile, Ala., to serve the large American market and use its main Quebec assembly line for other orders.
Muilenburg noted the Department of Commerce’s earlier ruling affirming Bombardier’s dumping behaviour still stands. The department approved duties of nearly 300 per cent that were overturned by the USITC.
“I think, for the longer term, again, the important principle here is we stand for fair global trade,” he said.
“And as long as we’re all playing by the same rules, we are more than happy to compete. But it’s important that we play by the same rules.”
Muilenburg said a deal with Embraer is a “great strategic fit” but acknowledged that the Brazilian government has some concerns.
The talks have been going on for a relatively long period of time but Boeing views it as a complimentary combination with complementary product lines, vertical capabilities, services capabilities and innovation, he said.
Even if that fails, Boeing has a solid strategy for the future and has identified the right investments to be made, Muilenburg said.
“We are ready to compete and win in the future, regardless of the outcomes of these trade matters and/or the potential deal with Embraer. And we’re going to stay very focused on executing that strategy. It’s a winning strategy.”
