Delta CEO on jet deal: ‘We will not pay those tariffs’

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Delta CEO on jet deal: ‘We will not pay those tariffs’

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CS100 rendering. Source: Delta Air Lines.

Amid a heated trade dispute over a Delta Air Lines order for jets made by Canadian manufacturer Bombardier, Delta CEO Ed Bastian said the airline will not pay tariffs proposed by the U.S. Commerce Department.

At issue is Delta’s order last year of 75 Bombardier C Series jets, which prompted Boeing to allege that Bombardier was getting illegal subsidies and dumping its product into the U.S. market.

The Trump administration has slapped Bombardier with proposed duties of nearly 300 percent.

Bastian said on a discussion about the company’s quarterly financial results that the decision from the U.S. Commerce Department “is not just disappointing, it doesn’t make a whole lot of sense.”

Delta is due to begin taking delivery of the planes in spring 2018.

“We will not pay those tariffs, and that is very clear,” Bastian said. “We intend to take the aircraft. I can’t tell you how it’s going to eventually work out. There may be a delay as we work through the issues.... There’s various other plans that we’re also contemplating and looking at alternatives.”

Bastian said he believes Delta will take the planes “at the agreed contractual price.”

He said he believes “there’s not a case to be made” that Boeing was harmed by the Delta order, because it does not make a similarly-sized airplane.

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