Bombardier US trade tariff uncertainty continues

Bombardier shares rose Friday as the plane maker continues to agree deals for the new C-series jets and looks for ways to avoid the US trade tariff of 300%.

Bombardier US trade tariff uncertainty continues

The safety of around 4,000 Belfast-based Bombardier jobs remains in question, as the US tariff row has yet to be settled.

However, the Bombardier share price rose some 1.65% in US trade Friday, as the company continues to take orders and make plans to create a delivery system that won’t be subject to potential punitive US trade tariffs of 300%.

That one-day gain saw the stock regain much of the loss made earlier during the week.

And now, the UK’s general trade union, the GMB, has raised the issue with the European Union Commission. The union said it has received assurances from the EU that the protection of Irish-based manufacturing jobs, is being taken seriously.

Bombardier US tax row should end in March

In September, Canadian transport manufacturer Bombardier was hit with US import tariff charges of over 200% for its new C-Series jet. That decision followed a complaint from competitor Boeing, it had received unfair state subsidies.

In a further assessment of the case in early October, the US trade department upheld Boeing’s complaint. It also raised the anti-subsidy import tariff charge, to just shy of 300%. A final US tax office ruling is due in February 2018.

That huge tax charge threatens Bombardier’s ability to agree deals with US airlines, including one that is currently in place with Delta. The US airline has placed a significant order of the new C-Series jets to be delivered in 2018.

However, following a deal with Airbus who now owns 50.1% of the Bombardier C-Series project, plans are being put in place to help change the way in which the C-Series is manufactured, including where the planes are delivered from.

GMB adds support

The UK government has made its disappointment over the tariff clear. However, little else has been discussed openly following the news of the higher tariff.

The GMB, meanwhile, said the EU wants to work with the UK Government to help secure the Belfast-based jobs.

“The talks were extremely positive and GMB secured a firm commitment from the EU to work together with GMB to try to resolve this issue and protect vital jobs in Northern Ireland,” said GMB regional organiser, Michael Mulholland.

And, following a visit from US Commerce Secretary, Wilbur Ross, trade union, Unite’s reginal organiser, Davy Thompson said: “Boeing's case against Bombardier is entirely unmerited".

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