“...there will be no impact in Quebec” Bellemare says - No Impact is... Not Adding Jobs to Mirabel?
If Boeing Loses its Complaint Why Would Airbus Still Built a CSeries Assembly Line in the USA Instead of Creating More Jobs in Quebec?
Click Like to Follow Fliegerfaust Facebook page to get the News ASAP / Share to share this post now.
Guy Norris and Graham Warwick | Aviation Daily
- That value is expected to come from increased orders for the aircraft, supporting a higher combined production rate in both Quebec and Mobile. "Airbus will accelerate the sales momentum and we are highly confident that we will gain more business and that there will be no impact in Quebec" from setting up a second line for U.S. customers, Bellemare says.
Airbus will bring its sales and marketing muscle to the C Series order book and its supplier management clout to procurement and production, while its global product support is expected to boost the confidence of customers wary to commit to the Bombardier airliner.
But more importantly, Airbus plans to assemble aircraft for U.S. customers alongside its A320 family in Mobile, Alabama, circumventing almost 300% in duties the U.S. government proposes imposing on C Series aircraft imported from Canada in response to Boeing's anti-dumping charges.
Both Enders and Bombardier CEO Alain Bellemare say the partnership is not driven by the U.S. trade dispute. "This was not motivated by anything the competition was doing," the Airbus CEO says. But talks leading to the partnership only began in August. Boeing filed its anti-dumping and countervailing duty petitions with the Commerce Department and International Trade Commission (ITC) in April and the ITC decided in June to proceed with an investigation.
Boeing reacted suspiciously to the news, and in a statement says "this looks like a questionable deal between two heavily state-subsidized competitors to skirt the recent findings of the U.S. government. Our position remains that everyone should play by the same rules for free and fair trade to work."
Bombardier continues to pin its hopes on the ITC determining that C Series pricing to win a key 75-aircraft order from Delta Air Lines in 2016 has done no damage to U.S. industry because Boeing did not offer a competing aircraft. If the ITC rules in February that no damage was done, the duties will not be imposed.
But if the ITC does find material damage had been done, and the import duties are imposed, Bellemare believes Delta is willing to wait until U.S.-assembled aircraft are available. "Clearly the Mobile option is on the table," he says. "We will now engage with them in depth."
"We think aircraft produced at this U.S. site will not be subject to [tariff] duty, but it's more strategic than that," Enders says. "It's a very good move to bring this aircraft to the U.S. because the U.S. is the single largest market for this segment."
Although unwilling to offer a timeline for when the U.S. line could be established, Enders says, "We need to go through various approvals in [the] coming months, [but] we have a lot of experience in setting up lines. It can be done in a relatively short period of time."
Assembly of the first U.S.-made A320 began at Mobile in mid-2015, less than three years after the Airbus announced the $600 million development in Alabama. But given the Mobile site is now well established, it may be possible for the exercise to be completed in even less time for the C Series.
Under the deal, Airbus will acquire a 50.01% interest in the C Series Aircraft Limited Partnership (CSALP), formed in 2015 when the Quebec provincial government invested CAN$41 billion in the program. Currently, Bombardier holds 62% of CSALP, and Investissement Quebec holds 38%. After the deal closes, Bombardier will own 31% and Quebec 19%.
No money will change hands on completion of the deal, and no debt will be assumed by CSALP. Airbus will enter commercial agreements covering sales and marketing, procurement management and customer support. Bombardier will continue with its existing C Series investment plan, providing up to $350 million in the first year and a combined $350 million over the next two years.
Enders acknowledges he vetoed an almost identical deal in 2015 ...
Read more here... http://aviationweek.com/commercial-aviation/airbus...