Canada warns it may cancel US jet buy over Bombardier probe

Canada warns it may cancel US jet buy over Bombardier probe

Canada warns it may cancel US jet buy over Bombardier probe

Bombardier lawyers were in a Washington, D.C. courtroom on Thursday, arguing against the petition and saying it was "unprecedented in its overreach".

Canada's government is warning it could cancel a planned purchase of 18 Super Hornet fighter jets from Boeing Co. because of U.S. Department of Commerce anti-dumping investigations against Canadian plane maker Bombardier.

Bombardier representatives counter that its planes never competed with Boeing in a sale to Delta airlines which the American firm has complained about.

"Canada is reviewing current military procurement that relates to Boeing", Freeland said in a statement.

"Boeing values Canada as a customer and supplier-partner for both our commercial and defence businesses", said company spokesman Dan Curran.

"We believe this action could have a very negative impact on airlines, the travelling public... and the aerospace industry", Bellemare added, noting Bombardier employs thousands of U.S. workers and buys components from United States manufacturers.

The allegations have been formalized as a 90-day window has been proposed for Canada-U.S. NAFTA negotiations to begin.

Boeing argued at a hearing in Washington yesterday that duties should be imposed on Bombardier's new larger CSeries passenger aircraft, insisting it receives Canadian government subsidies that give it an advantage internationally.

Boeing vice-president Raymond Conner said that kind of growth could force his company out of that mid-size market and cost the company US$330 million a year in annual sales.

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"Today we are at a critical moment", Conner told the seven-member U.S. International Trade Commission.

"You guys can fix this before it is too late".

A Commerce Department investigation into Boeing's claims could be cut short if the USITC rejects it in a vote expected on June 12.

The anti-dumping investigation will look into charges Canada's Bombardier receives subsidies of almost 80 per cent, and could lead the US Commerce Department to impose punitive import duties of that amount.

Boeing is calling for countervailing duties of 79.41 per cent and anti-dumping charges of 79.82 per cent. Boeing said Bombardier has received more than United States dollars 3 billion in government subsidies so far that have allowed Bombardier to engage in "predatory pricing".

Lawyers for the USA aerospace giant argued Thursday that Bombardier's own words prove it was rescued financially by multibillion-dollar assistance from the Quebec government, which a year ago invested US$1 billion in exchange for a 49.5 per cent stake in the CSeries.

Brazilian officials welcomed the US probe as support to the South America country's claim that Canada's support for Bombardier's CSeries undercuts the market for commercial jets made by Brazilian rival Embraer.

"Boeing would prefer that airlines buy older larger aircraft based on older technology", chief executive Alain Bellemare said during the company's shareholder meeting on 11 May.

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