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Bombardier to partner Airbus on C-Series jets Bombardier to partner Airbus on C-Series jets
(about 4 hours later)
European aerospace firm Airbus is to take a majority stake in Bombardier's C-Series jet project.European aerospace firm Airbus is to take a majority stake in Bombardier's C-Series jet project.
Bombardier has faced a series of problems over the plane, most recently a trade dispute in the US that imposed a 300% import tariff.Bombardier has faced a series of problems over the plane, most recently a trade dispute in the US that imposed a 300% import tariff.
Bombardier's Northern Ireland's director Michael Ryan said the deal was "great news" for the Belfast operation.Bombardier's Northern Ireland's director Michael Ryan said the deal was "great news" for the Belfast operation.
About 1,000 staff work on the C-Series at a purpose-built factory in Belfast, mostly making the plane's wings.About 1,000 staff work on the C-Series at a purpose-built factory in Belfast, mostly making the plane's wings.
Airbus and Bombardier's chief executives said the deal - which will see Airbus buy a 50.01% stake - would help to boost sales.Airbus and Bombardier's chief executives said the deal - which will see Airbus buy a 50.01% stake - would help to boost sales.
BBC Northern Ireland's business and economics editor John Campbell said Airbus had effectively taken control of the C-Series project in a transformational deal.BBC Northern Ireland's business and economics editor John Campbell said Airbus had effectively taken control of the C-Series project in a transformational deal.
He said it would use its financial muscle in procurement and sales, while Bombardier's manufacturing operations would continue to build the planes.He said it would use its financial muscle in procurement and sales, while Bombardier's manufacturing operations would continue to build the planes.
Importantly, Airbus has a major factory in the US, he said. "It thinks that by assembling the C-Series there, it will be able to sell them to US customers without facing tariffs." Analysis: John Campbell, BBC News NI economics and business editor
It's perhaps symptomatic of the difficulties the C-Series has faced that Airbus will not have to hand over any cash for its 50% stake.
The hope will be that Airbus' financial muscle will finally put an end to those difficulties.
In particular, Airbus thinks it can solve the C-Series tariff problem by assembling the plane for US customers inside the US at its factory in Alabama.
But, as trade expert Simon Lester of the Cato Institute pointed out to me, it may not be that straightforward.
That's because of something known as "trade circumvention" - in crude terms, when a company tries to avoid tariffs by superficially changing the country of origin of its products.
Will the US trade authorities (and Boeing) see an Alabama-assembled C-Series as an attempt at circumvention?
Importantly, Airbus has a major factory in the US, he said. "
It thinks that by assembling the C-Series there, it will be able to sell them to US customers without facing tariffs."
'Positive step''Positive step'
Bombardier was accused of anti-competitive practices by rival Boeing, which complained to the US authorities.Bombardier was accused of anti-competitive practices by rival Boeing, which complained to the US authorities.
Boeing accused the Canadian firm of selling the jets below cost price after taking state subsidies from Canada and the UK.Boeing accused the Canadian firm of selling the jets below cost price after taking state subsidies from Canada and the UK.
UK Business Secretary Greg Clark said the Airbus tie-up was a "positive step forward".UK Business Secretary Greg Clark said the Airbus tie-up was a "positive step forward".
Mr Clark said the UK and Canadian governments had been working to "safeguard jobs and manufacturing at Bombardier Shorts in Belfast, and the supply chain across the UK".Mr Clark said the UK and Canadian governments had been working to "safeguard jobs and manufacturing at Bombardier Shorts in Belfast, and the supply chain across the UK".
The government was still pushing for a "swift resolution" to the Boeing dispute, he added.The government was still pushing for a "swift resolution" to the Boeing dispute, he added.
Arlene Foster, leader of Northern Ireland's Democratic Unionist Party, said she hoped the deal would "safeguard" the C-Series programme.Arlene Foster, leader of Northern Ireland's Democratic Unionist Party, said she hoped the deal would "safeguard" the C-Series programme.
"I'm thrilled there is a bright future ahead following what has been a dark time for staff and management," she added."I'm thrilled there is a bright future ahead following what has been a dark time for staff and management," she added.