Bombardier Challenger 350

Airbus to sell Bombardier’s aircraft, Takes majority stake

 The boss of Airbus has said the firm expects to sell “thousands” of Bombardier’s passenger aircraft after an international tie-up with the planemaker. Airbus is taking a majority stake in the Canadian company’s C Series aircraft, which are part-made in Belfast. Thousands of Northern Ireland jobs looked to be at risk after a complaint from rival Boeing resulted in the US administration imposing a provisional tariff on each of the aircraft sold there. Airbus boss Tom Enders said the French firm did not plan to buy out the rest of Bombardier, or the Quebec regional government’s stake in the passenger plane scheme.

The announcement was made during a joint appearance with Bombardier’s chief executive Alain Bellemare yesterday. To view this media, you need an HTML5 capable device or download the Adobe Flash player. Mr Enders said he saw no reason why the company could not capture 50% of the single aisle passenger jet market. “I think we will sell thousands,” he added. Earlier this week it was revealed Airbus would acquire just over 50% of the C Series programme in a move that could safeguard thousands of jobs in Belfast, where the wings and part of the fuselage of the aircraft are made.

As part of the deal Airbus has the option to buy out Bombardier within about seven years, as well as the option to buy out the stake of the Quebec government in 2023. Airbus partnered with Bombardier in a workaround to avoid a potential 300% tariff on each aircraft sold in the US. The deal means Bombardier will lose control of the huge C Series project. Airbus plans to extend its own US factory in an apparent bid to get around the charge. But Boeing has claimed Bombardier’s C Series planes could still be hit with an import tariff in the US despite the deal, which will see the passenger jets assembled in Alabama.

Boeing general counsel Michael Luttig said: “Any duties finally levied against the C Series … will have to be paid on any imported C Series airplane or part, or it will not be permitted into the country.” According to Martin Craigs, the former marketing man for Short Brothers, which was taken over by Bombardier in 1989, Airbus’s taking of a stake in the C Series is a “masterful move which shifts the tectonic plates in the massive global market for single aisle airliners”. An initial 220% tariff was imposed on sales of the C Series by the US Department of Commerce. A later ruling increased the levy to 300%. The US’s International Trade Commission is due to give its final ruling on the matter in February. Airbus and Bombardier remain confident that their new deal will ensure the planes can be sold to US customers while at the same time avoiding a potentially huge charge. Bombardier will benefit from economies of scale from Airbus, as well as the potential of producing […]

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