Boeing responded to a stern round of questioning in the UK House of Commons Wednesday over its decision to challenge the legality of Bombardier’s sale of C Series jets to Delta Air Lines, in the process characterizing its actions as a kind of defense of free markets. During a meeting with the Northern Ireland Affairs Committee, Boeing Europe president Sir Michael Arthur rejected claims that the company’s appeal to the U.S. Commerce Department to place countervailing duties on the C Series sale to Delta undermined employment at Bombardier’s Short Brothers plant in Belfast, the site of the airplane’s composite wing production. Rather, he insisted that Boeing employs twice as many people in the UK than it did three years ago, and that trade union claims that the antidumping case contributed to a decline in employment at the Belfast site serve only to obscure Bombardier’s wider financial difficulties.
“Boeing is not putting Bombardier and Northern Ireland jobs at risk nor is Boeing in the wrong and we have not received illegal subsidies,” said Arthur. “One of the trade union witnesses at a previous hearing of the committee commented that the Belfast site has seen employment go from 10,500 when he began work there to 7,100 three years ago to 4,000 today. He also said that the apprentice program has been suspended for two or three years. These changes are not due to Boeing or the trade case. This issue is being used to cover up Bombardier’s broader challenges that all pre-date the case.”
Arthur’s points about Belfast followed a vigorous defense of the merits of the trade case and Boeing’s motivation for pursuing it. “The U.S. process is not political, but legal and it is very simple,” he said. “From Boeing’s perspective, Bombardier has sold aircraft in the U.S. at absurdly low prices, below the cost of production and below the price in other markets. It is a textbook case of dumping. It was done to seek a flagship sale in the U.S. to boost sales of an aircraft to which the market has not warmed.”
Arthur also rejected Bombardier’s claims that the C Series did not compete directly against the 737 Max in the Delta campaign, citing a precedent in which the smaller of the two C Series models—the CS100—competed with the 737-700 for a contract with United Airlines.
“Further claims have been made that Boeing did not compete on one of the deals cited in Boeing’s petition,” said Arthur. “These claims are both inaccurate and irrelevant. Inaccurate, because Boeing did compete for the sale, and its initial offering of used regional jet aircraft was dictated by customer preference, which changed only after Bombardier offered its C-Series jets at an absurdly low price, leveraging illegal state subsidies. Irrelevant, because this dispute relates to Bombardier’s activity in, and the resulting effects on, the U.S. market as a whole, not any single sale.”