US Adds Import Duty To Bombardier CSeries, Now 300 Percent

October 6, 2017

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The US Commerce Department has added to Canadian plane maker Bombardier’s problems with the announcement of a further import duty on its CSeries aircraft.

The department proposed a duty of 79.82 percent in a preliminary determination in its antidumping investigation of 100- to 150-seat large civil aircraft imported from Canada. The duty comes on top of a 219.63 percent duty announced last week for “countervailable subsidies” in financing the CSeries aircraft.

Bombardier “strongly disagreed” with the preliminary decision saying it “represents an egregious overreach and misapplication of the US trade laws in an apparent attempt to block the CSeries aircraft from entering the US market.”

Boeing petitioned the Commerce Department earlier this year alleging that Bombardier had sold 75 CSeries aircraft to Delta Air Lines at a cost that amounted to dumping. The total list price value of the order is USD$5.38 billion, or $71.8 million per aircraft, but Boeing said the price paid was $19.6 million per aircraft.

The Commerce Department said it based its preliminary ruling partly because Bombardier had failed to provide information requested by the department.

Bombardier disputed that saying “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.”

Bombardier said aircraft programmes cost billions of dollars and take years to provide a financial return on the investment. “By limiting its antidumping investigation to a short 12-month period at the very beginning of the CSeries programme, Commerce has taken a path that inevitably would result in a deeply distorted finding.”

The Commerce Department’s import duties apply not just to Bombardier, but all aircraft of that size imported into the US from Canada. The duties will only take effect if the US International Trade Commission rules in favour of Boeing in a final decision due next year.

(Airwise)