Bombardier vs. Boeing: Tariff Row or Opportunity?

by John Brian Shannon | Reposted from LetterToBritain.com

An increasingly protectionist United States has suddenly announced a 219% tariff on Bombardier passenger aircraft.

Bombardier Aerospace, headquartered in Montreal, Canada, also employs some 4000 people in Northern Ireland who produce a significant percentage of the components used in the C-Series passenger jets (CS 100 and CS 300) that have recently entered production.

Switzerland has already taken delivery of some of their C-Series jets, with others to be delivered in the coming months. Airlines from Germany, Finland and other European nations have indicated huge interest in these modern and fuel-efficient airliners, and China has told the company they will take as many planes as Bombardier can produce.

Bombardier C100 passenger aircraft
Bombardier C100 passenger aircraft. Image courtesy of BombardierAerospace.

There isn’t a better commercial aircraft in the 100-150 seat market in the world today.

And if that sounds like advertising copy, it’s because the aircraft the C-Series competes against were originally designed in the 1970’s (Boeing 737) and 1990’s (Airbus) and early 2000’s (Embraer) and although those aircraft lines have received numerous upgrades over the decades, from an engineering point-of-view nothing beats starting with a clean sheet.

This allows designers a free hand to use the latest composite materials, fully digital electronics instead of digital-over-analog, and 100% CAD/CAM design and manufacturing instead of only part of the process being CAD/CAM (Computer Aided Design/Computer Aided Manufacturing) all of which means there are no engineering compromises.

When you have the best plane on the market in that particular segment, one that boasts the quietest takeoffs and landings (significantly quieter) and the best fuel mileage, and the lowest maintenance cost per mile — high tariffs in one country means you simply sell the same number of aircraft per year — but you sell them to different countries.


China can’t get enough commuter aircraft from all sources it seems, and its own fledgling passenger aircraft manufacturer is geared towards truly excellent jumbo jet airliners. The country needs almost 7000 new aircraft over the next 20-years.

Boeing Forecasts Demand in China for 6,810 Airplanes, Valued at $1 Trillion (Boeing)

Good news for Bombardier! China becomes the world's first $1 Trillion aircraft market.

All good news for Bombardier there! The company should easily score 1/3 of all single aisle passenger jet sales in China over the next 20-years. And if they can’t, the entire executive staff of Bombardier should be exiled to Antarctica for life. Yes folks, opportunities like this don’t come along once-per-decade, nor even once-per-century.

Just in case you’re counting along at home; If Bombardier receives 1/3 of all single passenger jet sales in China over the next 20-years, it would need to deliver 6-jets per day to China.

(That’s China alone! India, the Middle East, Indonesia, and other nations all have rapidly growing markets for world-class single aisle passenger jets featuring low noise and exceptional fuel efficiency)

The future couldn’t be brighter for Bombardier and its clients. A missed deal with the United States might in retrospect turn out to be the best thing that ever happened to the company. Instead of thinking ‘regional’ — it’s now time to think ‘global’ — thanks to the U.S. Commerce Department.

Trade war, schmwade war! In the 21st-century, the name of the game isn’t getting into fights with your competitors, it’s about out-succeeding them.

Remember your pilot’s etiquette now; Always dip your wings ever-so-slightly (in respectful salute) every time you pass your competition! 😉


Related Articles:

  • U.S. Department of Commerce Issues Affirmative Preliminary Countervailing Duty Determination on Imports of 100- to 150-Seat Large Civil Aircraft From Canada (Commerce.Gov)
  • Britain’s Theresa May issues warning to Boeing over Bombardier trade dispute (The Globe and Mail)
  • UK government threatens retaliation against Boeing in Bombardier tariff row (The Guardian)
  • Boeing Super Hornet jet purchase likely to become 1st casualty in possible trade war (CBC)
  • Bombardier flying high after handing over first C-Series jet to SWISS (Financial Post)
  • On the book of Bombardier vs. Boeing, skip to Chapter 19 (The Globe and Mail)
  • May Says Boeing Undermining Ties With U.K. Over Bombardier (Bloomberg)
  • Bombardier Nears $1.25 Billion C Series Deal With Air Baltic (Bloomberg)
  • Bombardier C-Series Marketing Brochure (BombardierAerospace)
  • U.S. imposing 220% duty on Bombardier C-Series planes (CBC)
  • How Canada’s fight with Boeing began in Washington (CTV)
  • Bombardier BDRBF:US OTC (Bloomberg)

Biofuel ‘Roadmap’ Unveiled by Boeing, Japanese Aviation Industry

Boeing and Japanese aviation working towards low-emission biofuel future. Boeing 787 image courtesy of Boeing
Boeing and Japanese aviation working towards low-emission biofuel future. Boeing 787 image courtesy of Boeing

Boeing is leading local and global collaboration for the complex challenges our world faces now, and looking to the future. We support industry-wide approaches to align on ways to improve the environment. And whether it’s through the development of sustainable aviation biofuel or by working with communities globally on important environmental issues, we’re making a difference.

From working to improve the environmental performance of our products and services to working together for the benefit of our homes and communities, Boeing is building a better planet. — Boeing website

Boeing (NYSE: BA) and Japanese aviation industry stakeholders have charted a course to develop sustainable aviation biofuel for flights during the 2020 Olympic and Paralympic Games in Tokyo, when millions of people are expected to visit Japan.

The Initiatives for Next Generation Aviation Fuels (INAF) – a consortium of 46 organizations including Boeing, ANA… Continue reading Biofuel ‘Roadmap’ Unveiled by Boeing, Japanese Aviation Industry

South African Airways switching to tobacco biofuels

Originally posted at www.southafrica.info

South African farmers will soon harvest their first crop of energy-rich tobacco plants, an important step towards using the plants to make sustainable aviation biofuels, South African Airways (SAA) and American aeroplane maker Boeing announced yesterday

Solaris plantation in South Africa
Solaris plants, a new hybrid type of tobacco plant at a test farm in South Africa’s Limpopo province will provide biofuels for South African Airways jets. (Photo: SkyNRG)

SAA and Boeing, along with partners SkyNRG and Sunchem SA, also officially launched Project Solaris, their collaborative effort to develop an aviation biofuel supply chain using a nicotine-free, GMO-free tobacco plant called Solaris.

Company representatives and industry stakeholders visited commercial and community farms in Marble Hall, Limpopo Province, where 50 hectares of Solaris have been planted.

The test crop will be harvested for the first time in December.

Oil from the plant’s seeds may be converted into bio-jet fuel as early as 2015, with a test flight by SAA as soon as practicable.

Sustainable

“SAA continues to work towards becoming the most environmentally sustainable airline in the world and is committed to a better way of conducting business,” said Ian Cruickshank, the airline’s environmental affairs specialist.

It plans to scale-up its use of biofuels for its flights to 20-million litres in 2017, before reaching 400-million litres by 2023

“The impact that the biofuel programme will have on South Africans is astounding: thousands of jobs, mostly in rural areas; new skills and technology; energy security and stability; and macro-economic benefits to South Africa; and, of course, a massive reduction in the amount of CO2 that is emitted into our atmosphere.”

Lower costs

It would also lower the fuel costs of SAA, which contributed between 39% and 41% of the state-owned airline’s total operating costs.

“It is very exciting to see early progress in South Africa towards developing sustainable aviation biofuels from energy-producing tobacco plants,” said J Miguel Santos, the Boeing International managing director for Africa.

“Boeing strongly believes that our aviation biofuel collaboration with South African Airways will benefit the environment and public health while providing new economic opportunities for South Africa’s small farmers.

“This project also positions our valued airline customer to gain a long-term, viable domestic fuel supply and improve South Africa’s national balance of payments.”

Collaboration

The farm visits followed the announcement in August that SAA, Boeing and SkyNRG, an international market leader for bio-jet fuel, based in the Netherlands, were collaborating to make aviation biofuel from the Solaris plant, which was developed and patented by Sunchem Holding, a research and development company based in Italy.

If the test farming in Limpopo is successful, the project will be expanded in South Africa and potentially to other countries.

In coming years, emerging technologies are expected to increase aviation biofuel production from the plant’s leaves and stems.

Sustainable aviation biofuels made from Solaris plants can reduce lifecycle carbon emissions by 50% to 75%, ensuring it meets the sustainability threshold set by the Roundtable on Sustainable Biomaterials (RSB)

Test flights

Airlines have conducted more than 1600 passenger flights using aviation biofuel since the fuel was approved for commercial use in 2011.

  • Boeing is an industry leader in global efforts to develop and commercialise sustainable aviation biofuels.
  • Project Solaris began in 2012 with two hectares of crop, rising to 11 hectares in 2013, before expanding to the current 50 hectares.
  • The partners aim to expand the project to 30,000 hectares by 2020, leading to the production of 140,000 tons of jet fuel, the creation of 50,000 direct jobs and a reduction of 267 kt of CO2 emissions.
  • They envisage 250 000 hectares by 2025, according to SkyNRG chief technology officer Maarten van Dijk.

SAinfo reporter and Boeing
Read more here