In a completely unexpected move, Canadian manufacturer Bombardier has handed Europe’s Airbus control of the CSeries aircraft programme. Airbus expect regulatory approval in the second half of 2018 to acquire the 50.1% stake.
There are two versions of the aircraft, the CS100 which seats 103-133 passengers and is in service with Swiss. A stretched version, the CS300, seats 130-160 passengers and is currently flying for airBaltic. In service are 14 aircraft in total and there are 346 on firm order.
Delta Air Lines in the USA ordered 75 of the CSeries and Boeing essentially threw its toys out of the pram, filing a petition accusing Bombardier of price dumping and selling the aircraft below the cost of manufacture.
The US Department of Commerce handed down a preliminary ruling in Boeing’s favour imposing a 220% import tariff on the CSeries. This later increased to 300%, with the final ruling expected in December.
This went down pretty badly in parts of the aviation press. Despite financial problems that Bombardier experienced and questionable management of the programme, the CSeries is considered to be an excellent aircraft. More to the point, Boeing doesn’t really have a competing aircraft in this market space which makes the action even more questionable.
Additionally, over half of the aircraft components are manufactured by US suppliers. This means any tariff will directly impact American companies who produce items for the CSeries. This ranges from avionics suppliers to Pratt & Whitney who supply the engines, so this makes the Boeing stance all the more strange.
Airbus CSeries Swoop
Bombardier attempted to get Airbus to purchase the majority of the programme back in 2015 but Airbus declined at the time. Press reports today state this was due to the fact Airbus were busy with the A350 and other issues of its own.
Now it appears Airbus will have a 50.1% share of the programme, Bombardier 31% and the Quebec Government’s investment arm with 19%. Airbus also obtained the share for nothing at all. They will provide sales and marketing support for the aircraft and open a new assembly line in Mobile, Alabama.
What Does This Mean?
I imagine it is quite unlikely that any tariff can be levied on an aircraft assembled in the United States as there is no importing of the aircraft per se. It will actually create jobs in America so in one fell swoop the Boeing petition appears to be neutered.
Also, using the Airbus sales and marketing might should lead to additional sales and remove once and for all any airline hesitation about the programme viability. There appears to be no downside except for Bombardier who will cede control of an aircraft they designed.
This news certainly came out of left field and it will interesting to see how it will play out. The parties involved must believe regulatory approval will be given considering the announcements made.
Either way, it would be interesting to be a fly on the wall at Boeing in Chicago right now. Thank you for reading and if you have any comments or questions, please leave them below.
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Featured image by tjdarmstadt and airBaltic by Alf van Beem with both via Wikimedia Commons.
With thanks to FlightGlobal and BBC News.