Airbus to buy majority stake in Bombardier 'C Series' jet business

In the middle of a trade dispute over "C Series" jets Delta Air Lines is buying from Canadian manufacturer Bombardier, Airbus announced it will buy a majority stake in Bombardier's C Series business and add a final assembly line for the planes at the Airbus plant in Mobile, Ala.

The C Series assembly line in Mobile will serve U.S. customers, according to Airbus and Bombardier in the Monday evening announcement.

Atlanta-based Delta's deal to buy 75 Bombardier C Series CS100 jets has been in the cross-hairs of a Trump administration "Buy American" fight against the deal.

The low prices Delta negotiated in the deal prompted Boeing to allege that Bombardier was getting illegal subsidies and dumping its product into the U.S. market.

The Trump administration slapped Bombardier with proposed duties of nearly 300 percent that could quadruple the price of the jets.

Bombardier's CEO Alain Bellemare said during a press conference Monday evening that the U.S. assembly line will allow the aircraft to "become a domestic product, for which you have no import duty applied to a domestic product."

Bellemare also said Bombardier will continue to fight the Boeing petition and that the company is not doing the deal with Airbus because of the Boeing petition.

"We've said we're going to look at all options to protect our access to the U.S. market, so we can protect the overall value of the C Series aircraft, and that's what we're doing," Bellemare said.

Delta said Monday evening it could not comment, but that it "looks forward to introducing the C Series into its fleet."

Delta CEO Ed Bastian last week said: "We will not pay those tariffs, and that is very clear."

“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," Bastian said Oct. 11. "There’s various other plans that we’re also contemplating and looking at alternatives.”

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

Airbus would acquire 50.01 percent interest in the C Series Aircraft Limited Partnership, based on an agreement subject to regulatory approvals. If approved, the deal is expected to close in the second half of 2018.

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About the Author

Kelly Yamanouchi
Kelly Yamanouchi
Business reporter Kelly Yamanouchi covers airlines and the airport.
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