Boeing, Bombardier clash over tariffs at ITC hearing

Boeing and Bombardier had a heated verbal exchange yesterday over claims by the US planemaker that the Canadian company receives massive subsidies.(See: Canada to buy fleet of old fighter jets from Australia in snub to US )

The two sides faced off before the US International Trade Commission (ITC) in the latest round of their spat. Accusing Bombardier of harming sales of its 737 aircraft, the US planemaker called on the ITC to support tariffs on its rival.

However, Bombardier, which makes airplane wings in Belfast, said Boeing makes "money hand over fist" from the 737.

According to Boeing, Bombardier's new C-Series aircraft is being sold in the US below cost thanks to Canadian subsidies.

The US company came out the winner in the first round of the fight in October when the US commerce department ordered that tariffs of up to 300 per cent should be imposed on the C-Series.

The ITC will decide on making the tariffs permanent, which could effectively shut off the US market to the C-Series.

In opening remarks to the ITC hearing, Bombardier representative Peter Lichtenbaum said: "Boeing is making money hand over fist. And with a backlog of 737 orders years into the future, there are no signs of difficulty on the horizon."

The ITC is gathering testimony for deciding whether to the Department of Commerce's proposed 299.45 per cent tariff on Bombardier C Series jet bound for the US should take effect.

"Subsidised competitors don't face the same market realities we do. Our fortunes rise or fall based on the business decisions we make. There's no one there to bail us out if we misstep," Boeing commercial airplanes CEO Kevin McAllister said in his testimony. "But because of its massive government subsidies, Bombardier doesn't have to worry about these market realities. It used those subsidies to create and sell airplanes for millions of dollars under cost in the United States. "