Theresa May has threatened a trade war with the US after it slapped punitive tariffs on British-built aircraft, casting doubt on a key plank of her Brexit strategy.
The US Department of Commerce decided Bombardier aircraft, built in Northern Ireland, should be subject to 219 per cent import duty after the American aviation giant Boeing complained that Bombardier had been given unfair state aid.
The Government responded by warning that Boeing’s behaviour “could jeopardise” future Ministry of Defence contracts for its aircraft such as Apache helicopters.
The Prime Minister has appealed directly to President Donald Trump to intervene in the dispute, which has dented her hopes of signing a post-Brexit free trade deal with the US.
Mrs May said yesterday she was “bitterly disappointed” with the decision of the US Department of Commerce to propose an interim tariff of more than 219 per cent on the import of Bombardier C-Series jets to the US.
She said that Boeing’s long-term partnership with the Government is being “undermined by this behaviour.”
“We are very clear about the importance of Bombardier and the importance of those jobs in Northern Ireland and we will be doing everything we can to ensure that we can see those jobs being guaranteed in future,” she added.
Echoing Mrs May’s comments, Sir Michael Fallon, the Defence Secretary, said: “This is not the kind of behaviour we expect from a long-term partner.“We have contracts in place with Boeing for new maritime patrol aircraft and for Apache attack helicopters and they will also be bidding for other defence work and this kind of behaviour clearly could jeopardise our future relationship with Boeing.”
The dispute centres on a Boeing complaint that the jets were being dumped in the US at low prices after unfair state subsidies from the UK and Canada had helped Canadian-owned Bombardier win an order for up to 125 aircraft with US airline Delta.
Canada’s province of Quebec took a £740 million stake in the C-series programme. The recommended tariffs will only take effect if the US International Trade Commission rules in Boeing’s favour in a final decision expected next year.