Boeing breaks off talks as dispute with Bombardier ramps up

The Boeing Co. walked away from talks with Canadian officials over its trade dispute with Bombardier Inc., Canada’s ambassador to the U.S. said Tuesday, despite mounting pressure against the company to drop or settle its petition.

The U.K. government joined a growing list of interested parties urging Boeing to drop its trade complaint against Bombardier, which has a plant in Belfast that employs 4,200 people and manufactures wings for the C Series aircraft at the heart of the dispute. A U.K. government spokesperson confirmed Tuesday that Prime Minister Theresa May, who is set to visit Ottawa on Sept. 18, raised the issue on a call with U.S. President Donald Trump last week. A source told Reuters they expect the trade dispute to be discussed next week.

“This is a commercial matter, but the U.K. government is working tirelessly to safeguard Bombardier’s operations and its highly skilled workers in Belfast,” a U.K. government spokesperson said in an emailed statement. “Ministers across government have engaged swiftly and extensively with Boeing, Bombardier, the U.S. and Canadian governments. Our priority is to encourage Boeing to drop its case and seek a negotiated settlement with Bombardier.”

However, a settlement seems to be an unlikely option, particularly after Ambassador David MacNaughton told reporters that Boeing walked away from discussions between Canadian officials aimed at resolving the trade dispute. Speaking in St. John’s, MacNaughton said Boeing and the Canadian officials offered proposals for resolving the dispute before Boeing broke off talks.

U.K. Business Secretary Greg Clark also travelled to Chicago to meet Boeing chief executive Dennis Muilenburg to stress that the dispute would harm U.S. suppliers that benefit from the C Series program.

The Chicago-based aerospace giant filed a petition with the U.S. International Trade Commission and the U.S. Department of Commerce in April, alleging that massive government subsidies have allowed Bombardier to embark on “an aggressive campaign to dump its C Series aircraft in the United States.”

Bombardier has rejected Boeing’s claims, and on Tuesday called it “an unfounded assault on airlines, the travelling public and further innovation in aerospace.”

A Boeing spokesperson said in an emailed statement that its petition “seeks to restore a level playing field in the U.S. single-aisle airplane market.”

“Boeing had to take action as subsidized competition has hurt us now and will continue to hurt us for years to come, and we could not stand by given this clear case of illegal dumping,” the company said.

The dispute prompted a strong response from the Canadian government, which planned on purchasing 18 Super Hornet fighter jets from Boeing but broke off discussions over the multibilliondollar plan. The U.S. government approved the potential sale Tuesday, valued at US$5.23 billion.

A spokesperson from the government’s Global Affairs Canada on Tuesday called the petition “unjustifiable and based solely on Boeing’s desire to limit competition.”

Several airlines have also sided with Bombardier in the trade dispute. Delta Air Lines, whose order for 75 C Series jets is a crucial part of Boeing’s complaint, said in a post-conference briefing filed in May that there was “no reasonable indication or threat of material injury” to Boeing. Last month, low cost carriers Spirit Airlines and Sun Country Airlines urged the U.S. government to reject Boeing ’s complaint, calling it inappropriate and harmful to American consumers.

The U.S. Department of Commerce is expected to announce its decision on whether to impose duties against Bombardier on Sept. 25.