7 ms·

US Dept of Commerce puts 220% tariff on Bombardier

42 points by alexasmyths 9y ago

booblik 9y ago
Does Delta have to “import” the airplanes? As an airline, can’t they pretend the planes are based elsewhere, and just fly inside the States? Must be a loophole here somewhere.
- slededit 9y ago
  Foreign carriers aren't allowed to fly domestic routes but must have an international connection.
  - thephyber 9y ago
    I remember hearing something identical to this about ships: The Jones Act [1] which requires all ships moving from US port to US port must be mostly US owned and mostly US crewed. [1] https://transportationinstitute.org/jones-act/ https://transportationinstitute.org/jones-act/
    - jon_richards 9y ago
      Indian states often do this for intra-state trucking.
- neximo64 9y ago
  You can lease them (from a Canadian/offshore holding company), NetJets is likely to be more competitive as a result of this.
- alexasmyths 9y ago
  I believe the 'importation' counts if a US company buys anything, anywhere.
kogepathic 9y ago
I hope Boeing has done their napkin math correctly, because the Canadian government has threatened to cancel their Super Hornet purchase over this dispute. That's a $5 billion dollar order that may have just gone up in smoke: Canadian Prime Minister Justin Trudeau threatening to scuttle the country's plans to buy $5 billion worth of F/A-18 Super Hornet fighter jets from Boeing It would cost the Canadian government a lot of political capital to back down on this threat, so if the US is intent to apply an import tariff to the C-series I can absolutely see Canada cancelling the Super Hornet order.
- alexasmyths 9y ago
  As a Canadian, I wish that were true, but our gov does not ever play hard ball. We fully play the nice guy routine. There's no face-saving for us. I'm even surprised they made the threat. The other issue is - we are in a bind. We're buying F18's because we're not going to go for the F35s, at least for now. And switching temporarily to another vendor would be impossible ... and our 'long term commitment' is usually to the US when it comes to fighter jets etc.. It would be pretty interesting for Canada to go 'European' for the next 40 years, it would damage our relationship with the US. This is going to be big news in Canada and cause some ire, surely.
  - slededit 9y ago
    Canada is perfectly happy to not have functioning hardware for extended periods of time. Especially now that it has entered a far more isolationist stance under Trudeau (in terms of military involvement).
    - gaius 9y ago
      It's funny, most people in the rest of the world don't even think Canada has a military. What do the Mounties need with F18s? I am sure the Eurofighter consortium would be happy to take an order for some Typhoons tho'...
      - kogepathic 9y ago
alexasmyths 9y ago
As background: the Quebec government bought $1B worth of the 'C Series program' (in terms of share value, who knows what that means, and it's a murky thing), which is the primary source of concern I believe. Of course one could argue Boeing receives massive 'subsidies' from the US government in terms of pork-laden defence spending contracts. And other things, like incentives for various factories etc.. Airbus receives massive benefits from their network of R&D centres affiliated with Universities. It's almost a farce to talk about aircraft manufacture as 'purely free trade' - its de-facto a partly nationalized industry everywhere. There would be 0 large planes in the sky if governments were not involved.
- moomin 9y ago
  This: aircraft financing is a morass of government subsidies and every trade dispute (of which it seems like there's always one) smacks of pots calling out kettles. In other news, Bombardier is a brand of beer in the U.K. And that headline was rather confusing until I got into the article.
- majormajor 9y ago
  > Of course one could argue Boeing receives massive 'subsidies' from the US government in terms of pork-laden defence spending contracts. Were their defense programs (which includes clients outside the US, one of the interesting aspects of this move on their part, as they still want to sell Canada military planes) subsidizing their commercial operations, why would they not simply shut the commercial side down and keep more of that sweet, sweet, defense money as pure profit? Of course, if it doesn't, why doesn't Lockheed build out a commercial division? Do the technologies for each application just diverge too far to make it an irresistible combo?
  - AnodyneComplex 9y ago
    I think the idea is that Boeing gets a big head start on some commercial applications. E.g. they build a military cargo aircraft and can bill all of the R&D to the govt, then quickly convert the plans to something UPS wants. Probably similarly for flight control software, electronics etc. Though I'm not sure how much transfer you would see now that the designs for commercial planes are so mature.
PhasmaFelis 9y ago
"Bombardier" seems like an unfortunate brand name for commercial aircraft.

42 points by alexasmyths 9y ago

Does Delta have to “import” the airplanes? As an airline, can’t they pretend the planes are based elsewhere, and just fly inside the States? Must be a loophole here somewhere.

slededit 9y ago
Foreign carriers aren't allowed to fly domestic routes but must have an international connection.
- thephyber 9y ago
  I remember hearing something identical to this about ships: The Jones Act [1] which requires all ships moving from US port to US port must be mostly US owned and mostly US crewed. [1] https://transportationinstitute.org/jones-act/ https://transportationinstitute.org/jones-act/
  - jon_richards 9y ago
    Indian states often do this for intra-state trucking.
neximo64 9y ago
You can lease them (from a Canadian/offshore holding company), NetJets is likely to be more competitive as a result of this.
alexasmyths 9y ago
I believe the 'importation' counts if a US company buys anything, anywhere.

kogepathic 9y ago

I hope Boeing has done their napkin math correctly, because the Canadian government has threatened to cancel their Super Hornet purchase over this dispute. That's a $5 billion dollar order that may have just gone up in smoke: Canadian Prime Minister Justin Trudeau threatening to scuttle the country's plans to buy $5 billion worth of F/A-18 Super Hornet fighter jets from Boeing It would cost the Canadian government a lot of political capital to back down on this threat, so if the US is intent to apply an import tariff to the C-series I can absolutely see Canada cancelling the Super Hornet order.

alexasmyths 9y ago
As a Canadian, I wish that were true, but our gov does not ever play hard ball. We fully play the nice guy routine. There's no face-saving for us. I'm even surprised they made the threat. The other issue is - we are in a bind. We're buying F18's because we're not going to go for the F35s, at least for now. And switching temporarily to another vendor would be impossible ... and our 'long term commitment' is usually to the US when it comes to fighter jets etc.. It would be pretty interesting for Canada to go 'European' for the next 40 years, it would damage our relationship with the US. This is going to be big news in Canada and cause some ire, surely.
- slededit 9y ago
  Canada is perfectly happy to not have functioning hardware for extended periods of time. Especially now that it has entered a far more isolationist stance under Trudeau (in terms of military involvement).
  - gaius 9y ago
    It's funny, most people in the rest of the world don't even think Canada has a military. What do the Mounties need with F18s? I am sure the Eurofighter consortium would be happy to take an order for some Typhoons tho'...
    - kogepathic 9y ago

alexasmyths 9y ago

As background: the Quebec government bought $1B worth of the 'C Series program' (in terms of share value, who knows what that means, and it's a murky thing), which is the primary source of concern I believe. Of course one could argue Boeing receives massive 'subsidies' from the US government in terms of pork-laden defence spending contracts. And other things, like incentives for various factories etc.. Airbus receives massive benefits from their network of R&D centres affiliated with Universities. It's almost a farce to talk about aircraft manufacture as 'purely free trade' - its de-facto a partly nationalized industry everywhere. There would be 0 large planes in the sky if governments were not involved.

moomin 9y ago
This: aircraft financing is a morass of government subsidies and every trade dispute (of which it seems like there's always one) smacks of pots calling out kettles. In other news, Bombardier is a brand of beer in the U.K. And that headline was rather confusing until I got into the article.
majormajor 9y ago
> Of course one could argue Boeing receives massive 'subsidies' from the US government in terms of pork-laden defence spending contracts. Were their defense programs (which includes clients outside the US, one of the interesting aspects of this move on their part, as they still want to sell Canada military planes) subsidizing their commercial operations, why would they not simply shut the commercial side down and keep more of that sweet, sweet, defense money as pure profit? Of course, if it doesn't, why doesn't Lockheed build out a commercial division? Do the technologies for each application just diverge too far to make it an irresistible combo?
- AnodyneComplex 9y ago
  I think the idea is that Boeing gets a big head start on some commercial applications. E.g. they build a military cargo aircraft and can bill all of the R&D to the govt, then quickly convert the plans to something UPS wants. Probably similarly for flight control software, electronics etc. Though I'm not sure how much transfer you would see now that the designs for commercial planes are so mature.

PhasmaFelis 9y ago

"Bombardier" seems like an unfortunate brand name for commercial aircraft.