Bombardier profits soar by 57% in wake of trade dispute victory
Bombardier has announced a huge 57% rise in profits as an independent US trade body says rival Boeing did not lose out on sales when a US airline placed a multi-billion pound order for its part-Belfast made planes.
Bombardier workers in Northern Ireland breathed a sigh of relief when the US International Trade Commission last month ruled in its favour after a challenge by American rival Boeing. The firm had been facing a 292% tariff on the sale of its planes to the US.
Now, in a document explaining its reasons for backing Bombardier, the US ITC said that "Boeing lost no sales or revenues" as a result of Delta Air Lines placing an order for 75 of its C Series planes.
Following that order, Boeing launched a complaint against Bombardier, and claimed the Canadian-owned giant had been selling off planes at below cost and were unfairly subsidised by government.
Bombardier employs around 4,000 workers in Northern Ireland. It claimed, as a result, it lost out on sales of its own 737-700 aircraft. But the US ITC said: "The higher standard seating capacity of the 737-700 and 737 MAX 7 limits competition between those models and the CS100 for some purchasers."
And yesterday, Bombardier revealed a surge in profits across the company for the last year.
Its earnings before interest and tax for the whole of last year rose from $427m (£304m) to $672m (£478m).
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Its chief executive, Alain Bellemare, said the explanation from the US ITC over the Boeing trade challenge was "good news".
"Bombardier closed out the second full year of its five-year turnaround plan with very strong performance," he said.
"Because of this solid performance, we begin 2018 with great momentum. Our operational transformation is in full motion: our growth programs - including the Global 7000 - are on track and we have a clear line of sight to our 2020 objectives."
The Global 7000 jets are also part-Belfast made.
In its latest results, Bombardier said: "We are moving ahead and making progress obtaining regulatory approvals for the announced partnership with Airbus for the C Series aircraft.
"We expect to obtain all approvals for the partnership in 2018, and in the meantime, we are conducting site visits and planning for the operation of the US final assembly line in Mobile, Alabama, and working on other integration streams, consistent with antitrust law".
It said, following the US ITC decision, it now has cleared "the path for us to support Delta this year as we work to close our partnership with Airbus".
Meanwhile, following the decision, the Northern Ireland Affairs Committee has said the UK government should take "careful note of the readiness of an American interest to take an aggressive stance" to defending its own business interests following a "spurious" international trade challenge against Bombardier.
The Northern Ireland Affairs Committee has said the decision "should be celebrated" and that "with the threat of tariffs lifted Bombardier will expand its operations and thrive".
And it also said that it should "no longer assume" that its loan investments, which Bombardier received and which Boeing objected to, "are low risk and will always be compliant".