Belfast Telegraph

Belfast workers are caught up in a 30-year trade war

By Martin J Craigs

This week hundreds of aerospace companies and thousands of high skilled staff involved in producing the 108 seat Bombardier C Series airliner are intently tuning into the latest chapter in the global airliner trade war.

I am familiar with this conflict, I lost my job twice in my mid 40s as a result of earlier clashes. I can relate to this week's global news drama and the very real anxiety at an individual human level.

It's important, therefore, that the background story is fully understood and future options are appreciated.

Boeing, on September 26, successfully pressed the US Department of Commerce to place 220% interim tariffs on the 75 firm orders and 50 options on the Bombardier C Series announced in a "sticker price" of $4bn deal by Delta Airlines in April 2016.

The US Department of Commerce and its compatriots in the International Trade Commission have so far found in Boeing's favour and as due process/counter claim will be shaped around President Trump's 'America First' philosophy, this vital launch order will certainly be disrupted and, in worse case, cancelled.

Understandably this is of great concern to Northern Ireland's largest industrial company, and its staff, suppliers, unions, multiple stakeholders and political representatives.

The Delta specification C Series airliners are effectively already in production and the customer expects to utilise, in their words, the 'best in class 100-150 seat airliner on their premier routes to New York and Los Angeles this spring'.

Unlike politics, there is not a kick-the-tin-down-the-road option. The aerospace industry has to operate to rigorous timescales and the voracious reliability and price expectations of consumers. Politics and state subventions are, however, at the heart of airframe manufacturers' finances worldwide.

Hence the interventions of ministers, prime ministers and troublingly the dependence on President Trump's distracted administration for well reasoned guidance on the C Series dumping claim.

My former Short Brothers colleagues at Bombardier in Belfast, who are blameless for this crisis, are right to be concerned by the high intensity politics. Be minded that Boeing are themselves still scarred by the 'state sponsored rise of Airbus'.

Boeing's complex, and some say hypocritical, multi-million dollar legal claim is part of an ongoing 30-year global trade war between the countries and companies.

It is worth knowing that forecasters Flight Global predicted, in their 20-year forecast this month, delivery of 43,700 new 100+ seat aircraft between 2017-2036.

Note 65% of those aircraft are expected to be single aisle, predominately Airbus 320 or Boeing 737 family. I offer these stats to allow readers to comprehend why Boeing and Airbus are to say the least protective of their 89% slice of this massive single aisle airliner pie.

Canada are, in simple terms, playing with the big boys, and Northern Ireland is in the scrap. Jobs in high-tech industries are precious in Northern Ireland, but equally so elsewhere. In the short term Bombardier's staff and stakeholders in and around Belfast should hold steady, safe in the knowledge the C Series is ironically, in many respects, in a sweet spot.

Airbus and Boeing have over five years of backlogged narrow body orders. Also oil prices are rising, meaning old airframe retirements increase.

The C Series low fuel consumption produces attractive lifetime operating costs linked to Belfast's highly developed composite wing building capabilities. Flight Global predicts the technically advanced C Series will secure 5% of the global market.

But predictions are just pieces of paper or lines on screens, the real politics always intervenes in the aerospace business.

It would be wise to plan for the worst, while thinking laterally about how best to utilise the deeply embedded engineering nous and conflict resolution skills, necessarily built into the DNA of local business.

Northern Ireland Inc. can, despite this setback, build imaginatively on its fabled aerospace heritage, world class facilities and much respected workforce.

However, strong leadership and insightful strategies are essential. The overall political and business culture of NI Inc needs to become more enterprise than entitlement-orientated on the road to self reliance.

Martin J Craigs is a former marketing executive at Short Brothers and was also president of Aerospace Forum Asia and chief executive of Pacific Asia Travel Association

Belfast Telegraph

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