In a surprise decision, the U.S. International Trade Commission has sided with Bombardier, the Canadian jet-maker, in a case brought by rival Boeing over planes sold to Delta. The case involved the sale of planes to Delta Airlines that Boeing said were priced below their cost of production and that received illegal subsidies from the Canadian government.
Boeing argued that the trade practices were illegal and harmful to its business, and was trying to have 300% duties applied to the planes. The tariffs were recommended by the Trump administration last year. Delta CEO Ed Bastian has refused to pay the duties, calling them “absurd.”
Boeing said it was “disappointed” by the decision. “Those violations have harmed the U.S. aerospace industry, and we are feeling the effects of those unfair business practices in the market every day,” a statement read.
The case involves Delta’s purchase of at least seventy-five C Series jets from Bombardier in 2016, which are roughly 100 seats in size. Delta says it opted for the planes because Boeing offered no viable alternative.
Interestingly, European aviation giant Airbus has taken a majority stake in Bombardier’s C Series, and has said the jets could be manufactured in Alabama, where Airbus already manufactures airplanes. The decision has not been made final, but Airbus CEO Alain Bellemare said after the ruling was announced that the company is “committed to creating jobs in the U.S.”
Boeing still has legal options. They could take the appeal to the International Court of Trade in New York. The U.S. could also take the case to the World Trade Organization. Boeing will “continue to document any harm to Boeing and our extensive U.S. supply chain that results from illegal subsidies and dumped pricing,” the company said.