US launches probe of Boeing dumping, subsidy claims vs Bombardier


Bombardier lawyers also point to Boeing's enviable backlog of products, suggesting that Boeing has not lost any revenue as a result of the alleged predatory pricing action by Bombardier. "Our government will defend the interests of Bombardier, the Canadian aerospace industry, and our aerospace workers".

WASHINGTON-The next potential Canada-U.S. trade dispute unfolded Thursday as aerospace giants clashed at a Washington hearing that marked the formal launch of investigations into Boeing's allegations that Bombardier received subsidies allowing it to sell its CSeries planes at below-market prices.

The Commerce probe in Boeing's case, which was expected, parallels a probe by the U.S. International Trade Commission (USITC) into Boeing's allegations that Bombardier sold 75 CSeries planes to Delta Air Lines Inc a year ago at a price well below cost.

USA government officials on Thursday are set to begin investigating Boeing Co's unfair trade claims against Canadian rival Bombardier, a two-track action that could lead to US duties on Bombardier's new jetliner and also pits Boeing against Delta Air Lines Inc.

If the Commerce Department determines that Boeing's so-called dumping charges carry merit and the ITC determines that dumped and/or unfairly subsidized Canadian imports of civil aircraft into the United States harm US industry, the Commerce Department can impose duties on the imports equal to the dollar value of the improper actions.

"Today we are at a critical moment", Conner told the seven-member U.S. International Trade Commission.

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The anti-dumping investigation will look into charges Canada's Bombardier receives subsidies of almost 80 per cent, and could lead the US Commerce Department to impose punitive import duties of that amount.

Boeing vice-president Raymond Conner said that kind of growth could force his company out of that mid-size market and cost the company US$330 million a year in annual sales.

The preliminary ruling on the 100- to 150-seat planes is due by June 12. Representatives for the airline are scheduled to appear at Thursday's hearing to oppose Boeing's call for duties.

Boeing lawyers are arguing before the trade commission that Bombardier's own words prove it was rescued financially by multibillion-dollar assistance from the Quebec government. The company also shored up its finances by selling a 30 per cent stake in its railway division to pension fund manager Caisse de depot for US$1.5 billion. (NYSE:BA) has accused rival Canadian plane-maker Bombardier, Inc.

"Our presentation provided the ITC with information about our superior C Series aircraft, which was created to fill a market that Boeing abandoned", it said.

Boeing had offered Delta the 737 Max 7, a re-engined derivate of the 737-700 that competes directly with the C Series. "If this is a case of David vs. Goliath, Boeing has cast itself in the wrong role". Bombardier revenues past year were US$16.3 billion, including US$9.9 billion from aerospace activities.