Boeing trade dispute with Bombardier 'unjustified and unwarranted'

An international trade dispute with major implications for jobs in Northern Ireland is unjustified and unwarranted, the British Government said.


A preliminary finding is due later from the US authorities after aerospace giant Boeing claimed its multinational rivals Bombardier received unfair state subsidies from the UK and Canada, allowing them to sell airliners at below cost prices in the US.

Bombardier will discover on Tuesday whether it may face financial penalties in a major blow to its manufacturing operation in Belfast, but it will be February before a final ruling on imposing tariffs is made by official agencies across the Atlantic.

Northern Ireland Secretary James Brokenshire said: "The UK Government believes clearly that the support that we have given through repayable launch investment to the C-Series project is legitimate, is lawful, is within World Trade Organisation rules and therefore that the actions that have been brought around this case are unwarranted."

Bombardier employs more than 4,000 people at a plant in East Belfast. It is one of Northern Ireland's largest employers and supports hundreds of other jobs through its suppliers.

Its immediate future was secured after it signed a 5.6 billion US dollar deal last year to provide up to 125 of its new C-Series aircraft to Atlanta-based Delta Airlines.

The wings are made in Belfast, employing at least 800 people directly, and Prime Minister Theresa May has lobbied President Donald Trump over the importance of preserving the posts.

The alleged unfair subsidy arose after Northern Ireland's power sharing government and the UK Government pledged to invest almost £135 million in the establishment of the C-Series manufacturing site in Belfast.

The programme also received one billion US dollars from the provincial government in Quebec in 2015 when its fortunes appeared to be ailing.

Boeing's complaint said it was seeking a "level playing field" for global competitors, but Bombardier accused its rival of hypocrisy.

Any US Department of Commerce decision to impose tariffs would increase the cost of importing the plane to the US.

George Burnside, a senior steward at Bombardier Belfast, said fear of what the ruling may hold was stalking the work floor but the final ruling on punitive charges could be made in the US in February.

"If the C-Series is ground to a halt, potentially you have up to 800 jobs there plus you have the supply chains in the wider community as well, so it is a very worrying time.

"But the union is in there fighting hard along with the British Government and along with our local politicians so we are hopeful we can get a resolution."

He said the atmosphere in Bombardier was quiet and muted.

"You can feel the fear in the factory because they don't really know what the actual outcome could be."

Jimmy Kelly, Unite the Union's Irish regional secretary, said Boeing had suffered no detriment and that there was no merit in this case.

"We are emphasising that the British Government needs to be stronger in saying to Boeing that they are reviewing, revisiting, re-looking at contracts that are very sizeable, second only to Japan, and that the British Government should be using that leverage with Boeing."

In response, Mr Brokenshire called for a "negotiated" outcome.

Mrs May's intervention came after she was pressed to raise the issue by DUP leader Arlene Foster, whose 10 MPs are propping up her minority administration in the House of Commons and are expected to play a crucial role during upcoming Brexit business in Parliament.

The C-Series is a single-aisle, mid-range aircraft which will provide competition for the Boeing 737.

Deliveries are due to begin next year.

The innovative carbon-fibre composite technology, developed in Belfast to produce the wings, enables material and aircraft weight savings, contributing significantly to the C-Series airliner's economic and environmental credentials, Bombardier said.

Delta is taking the smaller CS100 model of the plane.

In February last year, Bombardier announced 1,080 job losses at its Northern Ireland plants following delays to the C-Series.