Analysts Pan Boeing Strategy In Pushing for Tariffs on Bombardier

Analysts Pan Boeing Strategy In Pushing for Tariffs on Canada’s Smaller Jet (excerpt)

Leading aerospace analysts are highly critical of Boeing’s push to impose steep tariffs on U.S. sales of Bombardier’s small CSeries passenger jet, saying the case will damage the long-term interests of both Boeing and the U.S. aerospace industry.

“The free market and free competition are good for us,” said Adam Pilarski, a senior vice president with consulting firm Avitas and a leading aviation analyst. “Boeing shouldn’t want to move away from that, because to do so will hurt Boeing.”

So convinced is Pilarski that this prospect harms U.S. interests, he doesn’t believe the 220 percent tariff announced Tuesday ultimately will be imposed on the Canadian plane maker’s jets.

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By pushing the case before the U.S. International Trade Commission (ITC) — a forum that’s unilateral and therefore clearly biased — rather than before an international tribunal, Boeing will only encourage countries like China, Russia and Brazil that have big aerospace ambitions and large home markets to do the same to Boeing in the future, he said.

“You are giving your real competitors an excuse to say, if the U.S. can do this, we can do it,” Pilarski said.

Richard Aboulafia, a prominent aviation analyst with the Teal Group, agreed, calling saying this week’s ruling “a tactical victory but strategically a disaster” for Boeing.

He said the immediate harm to Boeing is the likely loss of big defense contracts from the two most reliable military allies of the U.S.

The Canadian government has already put on hold a $5.2 billion deal that was all but finalized for Boeing F/A-18 jet fighters and related weapons systems. The Canadians are known to be interested also in buying P-8 anti-submarine jets and Chinook helicopters from Boeing. For now, those possibilities are off the table, too.

And because the CSeries wings are made in Belfast, Northern Ireland, where 1,000 jobs are threatened, future U.K. defense buys are also at risk. (end of excerpt)

Click here for the full story, on the Seattle Times website.

(EDITOR’S NOTE: A spokesperson for the British Ministry of Defence said September 28 that:
“Boeing’s position in this case is unjustified and not what we expect of a long-term partner to the UK.
“Whilst this will not affect our existing programmes, these actions could undermine our future relationship and programmes.)

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