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From left, Pierre Beaudoin, Bombardier chairman, Tom Enders, Airbus chief executive, Alain Bellemare, Bombardier president and Fabrice Brégier, Airbus chief operating officer, celebrate the takeover deal.
From left, Pierre Beaudoin, Bombardier chairman, Tom Enders, Airbus chief executive, Alain Bellemare, Bombardier president and Fabrice Brégier, Airbus chief operating officer, celebrate the takeover deal. Photograph: Airbus Handout/EPA
From left, Pierre Beaudoin, Bombardier chairman, Tom Enders, Airbus chief executive, Alain Bellemare, Bombardier president and Fabrice Brégier, Airbus chief operating officer, celebrate the takeover deal. Photograph: Airbus Handout/EPA

Bombardier’s Belfast workers breathe sigh of relief after Airbus swoops in

This article is more than 6 years old
Takeover deal reassures staff even if the manoeuvre fails to convince US to lift punitive tariffs on order by Delta

What takes place at Bombardier Aerospace’s factory at Belfast is one of those everyday, patented modern miracles – and one whose success now depends on politics and business machinations continents away.

Rolls of carbon fibre are cut, injected with resin and pressure-cooked and cured to form an aircraft wing. This is shipped from Belfast city docks via Liverpool and New York to be fitted in Mirabel, Quebec, and become part of Bombardier’s innovative C-Series plane.

When one of the world’s biggest airlines, Delta, placed a multibillion-dollar order in 2016, it looked like the C-Series could really spread its wings – until the US slapped punitive, 300% tariffs on its import last month.

Then, last week, Airbus announced it was taking over the programme from Bombardier: a tie-up that potentially guarantees the plane’s future. But will this move prove a stroke of commercial genius or simply be blocked as a transparent attempt to circumvent the US government’s ruling – and will the jobs of 1,000 people making wings in Northern Ireland be preserved?

At the heart of the row is a plane that its Canadian manufacturers hoped could finally break through the Airbus-Boeing duopoly. The C-Series aircraft, built on advanced composites and technology, sets a new standard for efficiency and comfort for its passengers, its makers say. But those passengers are flying only in and out of Switzerland and the Baltics. Years of delay in production had cost Bombardier customers; and while Air Baltic and Lufthansa’s Swiss have had CS300s in service since 2016, the 75 planes ordered by Delta was the first deal big enough to make the whole programme look viable. Crucially, it gave the C-Series entry to the US market, accounting for up to half of its prospective sales worldwide.

Little wonder Boeing wanted to stop it: the US corporation has seen Airbus, also backed by state subsidies, grow to challenge its dominance. Bailouts of Bombardier by the Canadian government between 2015 and this year – as well as subsidies to Northern Ireland’s operations from the UK – amounted to illegal state aid, it argued, and the US Department of Commerce concurred, slapping 300% tariffs on Delta’s order, a purchase worth up to $5.6bn (£4.2bn).

Airbus had already examined the merits of buying parts of Bombardier’s operation. But now the European giant’s move to take a majority stake in its C-Series programme was “win-win-win”, as Airbus’s chief executive, Tom Enders, put it. It affirmed the future of the C-Series, and by switching final assembly of the planes to the Airbus factory in Mobile, Alabama, would eliminate import tariffs and enable the Delta deal to go ahead. The other win, Enders didn’t say, was to outmanoeuvre Airbus’s great rival, Boeing.

The cockpit of a Bombardier C-Series aircraft. Photograph: Regis Duvignau/Reuters

Boeing argues: “Everyone should play by the same rules for free and fair trade to work.” Its own legal view is that the C-Series was “dumped” below price in the US market, whether whole or in parts, and the Airbus deal would not change that verdict.

The politics are complex: the move will mean more US jobs, while the C-Series has engines made by Pratt & Witney and avionics from Rockwell Collins, both American firms. The proposed tariffs may not be ratified by the US trade commission – the fervent hope of the Unite union in Belfast, which warns that tariffs will cast a long shadow even if Airbus saves Bombardier for now.

For the UK, Theresa May’s efforts to influence President Donald Trump, alluding to Britain’s defence contracts with Boeing, appear to have been fruitless. Boeing has been keen to stress its own involvement in the UK, and the wider jobs that depend on it. A first Boeing facility in Europe is being built in Sheffield, with only 50 jobs expected – but it spent £2.1bn last year, supporting 250 companies and 18,700 jobs in the UK supply chain.

Unite, meanwhile, is taking its campaign to Brussels. While the irony of Britain, looking to secure trade deals post-Brexit, being rebuffed by the US and then rescued by a pan-European business has been widely remarked on, the secondary worry for Northern Ireland will be its future place in Airbus’s supply chain outside EU borders and customs agreements.

However that plays out, Bombardier in Belfast has been vastly assured by the Airbus takeover – with hopes of an expanded order book and new markets, even if the US situation is unresolved. Infrastructure investment in Northern Ireland has lagged behind the UK – at least until the Conservatives’ post-election agreement with the Democratic Unionist party: the costs of energy and transport count against it and skilled jobs are precious.

More and more of Bombardier’s 4,200 employees in Belfast – from engineers and computer designers to the assembly line and support roles – expect to transfer to work on the C-Series in future. Davy Thompson, Unite’s regional officer and an ex-Bombardier employee, says: “If it was stopped, it would call into question the whole viability of the site.”

Aerospace brings about £400m into the region’s economy each year, he says: “You have families work here. They’re very highly skilled, sought-after jobs.” The UK response should, he says, “be a lot stronger. It’s UK aerospace today – it could be elements of any industry tomorrow.”

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