Boeing Won't Appeal ITC Ruling on C Series

 - March 23, 2018, 10:20 AM
An order from Delta Air Lines for 75 Bombardier CS100s originally called for first delivery this spring, but uncertainty over the outcome of Boeing's product dumping complaint and the timing of Airbus's plans to build C Series jets in Mobile, Alabama, delayed those plans. (Image: Bombardier)

Boeing has decided not to appeal the ruling by the U.S. International Trade Commission overturning an earlier decision by the Commerce Department to impose steep tariffs on Bombardier C Series narrowbodies sold in the U.S., a Boeing spokeswoman confirmed. Boeing’s decision effectively ends its attempts to block a the sale of 75 C Series CS100s to Delta Air Lines through a process by which it had hoped the ITC would impose duties of nearly 300 percent of the price of each airplane. Asked by AIN to explain the reasons for its decision to drop the case, Boeing declined to elaborate.

For its part, Bombardier applauded the ruling and characterized Boeing’s complaint as baseless. “Boeing's claim was meritless and should never have been brought,” said a Bombardier spokewoman in a written statement. “We are happy that it has come to an end. This is good news for the whole aerospace industry and the flying public, which will benefit from the most innovative commercial aircraft built in the last 30 years.”

In Boeing’s original complaint, filed last April, it claimed that Bombardier sold Delta the airplanes for $19.6 million each, or some $13.8 million less than they cost to manufacture, thanks to subsidies provided by the governments of Canada and Quebec. Bombardier contested both the basis of the claims and the cost estimates provided by Boeing in its complaint, arguing the C Series competes with no Boeing product, and therefore could not have caused any harm to the U.S. company.

After the U.S. Commerce Department sided with Boeing in a pair of rulings that imposed anti-dumping duties and countervailing measures totaling nearly 300 percent, the USITC overturned the decisions based on its determination that the Delta sale caused no harm to Boeing. The decision came as a huge boost for Bombardier, whose C Series project effectively faced a loss of access to the U.S. market.

The Delta order originally called for deliveries to start this spring, but when Airbus agreed in mid-October to take a majority stake in the C Series program and assemble some of them at the site of its A320 plant in Mobile, Alabama, it looked as though Delta would have to accept a delay in deliveries while Airbus built the new U.S. assembly line. Now, the unexpected USITC ruling in favor of Bombardier means that Delta can take airplanes built in Mirabel, Quebec, the site of the primary C Series line. However, neither Airbus nor Bombardier has indicated whether or not the victory in the anti-dumping dispute will mean a change in plans for the source of Delta’s airplanes.