As we have informed you earlier this week, the Trump administration heightened the duties to be paid on Canadian Bombardier planes to a whopping 300% if imported into the US. You can find the details of that here: https://thegoldwater.com/news/9307-Trump-s-Commerce-Department-Ups-Import-Duties-for-Canada-s-Bombardier-to-300
Of course, this would spell trouble for Delta airlines as this whole story (Boeing launching a complaint at the Commerce department against Bombardier) started when the US airline chose to order 75 (some say as many as 125) jets from Bombardier’s C-Series rather than Boeing because of the cheaper price the Canadians were able to offer.
According to the Delta Airlines CEO, Mr Ed Bastian, this is untrue. The reason why Delta chose to go with Bombardier is because of innovation, not price. He also said it was ‘absurd’ that the department of commerce slapped a 300% import duty on the Bombardier planes and stated he would refuse to pay.
When asked if he still felt this way, Mr Bastian responded: “I do, it’s a preliminary ruling, it’s not the final ruling. The Bombardier C-Series product is innovation, it brings a 100-seat product to our market that no US manufacturer produces. Boeing stopped producing it 10 years ago, the 717, and we are the largest user of the 717. I creates over 20,000 jobs in the US and it is innovation that this market needs.”
Mr Bastian refused to inform the gathered press about the price Delta paid, but it was clear from his answer that the list price was never final. Mr Bastian: “You know what happens to list prices in the airplane market, and as a launch customer, every single product that’s ever been sold into the market, there’s substantial discounts.”
During an earnings call later this week, Mr Bastian repeated his point and stated: "We will not pay those tariffs and that is very clear."
Because of the duty discussion, there may be a delay in starting delivery of the first jets to Delta from Bombardier.
Source:
http://uk.businessinsider.com/delta-ceo-refuses-pay-tariffs-new-bombardier-cseries-jets-2017-10
