A slap in taxpayer’s face

So what’s the bottom line in the deal that hands control of Bombardier’s struggling C Series airline project over to the European giant Airbus? Just this: Taxpayers in Canada have sunk well over a billion dollars into the venture for the privilege of subsidizing jobs making planes in Alabama.

This is an amazing deal for Airbus, which gets a controlling share (50.01 per cent) in the C Series for an investment of — exactly nothing at all. It won’t even take on any of Bombardier’s debt. What it contributes is its financial and organizational muscle plus a scheme to dodge punitive tariffs imposed on the C Series by the U.S. Commerce Department.

At a stroke, Airbus takes out Bombardier as a potential competitor in the growing market for jets carrying 100 to 150 passengers. And it sets itself up to compete vigorously in that category with Boeing.

But it does it at the cost of moving production south of the border for a plane in which Bombardier has already sunk $6 billion. The Quebec company is also on the hook to cover hundreds of millions of dollars more in potential losses for the project.

Better, from Bombardier’s point of view, to salvage some part of the C Series project than to see the whole thing collapse.

But from the point of view of taxpayers who have been called upon again and again to come to the rescue of the company in the name of preserving jobs in Canada’s supposedly vital aerospace sector, this is a big slap in the face.

Toronto Star