Boeing has promised to spend $18 billion in Canadian aerospace industry over the next decade if the contract is awarded.
Canadian Prime Minister Justin Trudeau is scheduled to discuss the five-month old dispute between Boeing and Bombardier with his British counterpart Theresa May on Monday. May is also siding with Bombardier which has large facilities in Northern Ireland, The Globe and Mail reported.
Boeing complained in April to the US Department of Commerce that Bombardier's C Series planes were unfairly subsidized by the Canadian and Quebec governments. Last year, Bombardier sold 75 109-seat CS100 planes to Delta Air Lines at a cut-rate cost, which led to Boeing's accusation of predatory pricing.
Bombardier has denied any wrongdoing and is currently defending itself in front of the International Trade Commission.
The government is refusing to sign a planned multibillion-dollar contract for Super Hornets as long as Boeing pursues its complaint against Bombardier at the International Trade Commission in the US, The globe and the mail reported quoting Federal officials as saying last week.
The Canadian government is looking at buying second-hand fighter jets from Australia instead of buying a new fleet of 18 Super Hornets from Boeing.
A Canadian delegation was in Australia last month to see if the second-hand F/A-18 fighters placed on the market could fit Ottawa’s needs for interim fleet.
"We recognize the Canadian government might be upset with us. We don't intend to upset anybody, but we plainly have to do what we believe is right," Boeing International president Marc Allen was quoted by the news daily as saying.
The U.S. Department of Defence revealed this week that the contract for the Super Hornets could be worth up to $6.4-billion, putting an approximate value on the benefits package that could flow to Canadian industry over five years.
"We have committed to working with the government of Canada agreeing to meet 100 per cent Canadian content value in addition to all other requirements in the areas of value proposition elements, export assistance, regional diversity and support of small-medium business growth," Boeing said in a statement to The Globe and Mail.
The company added that the overall investments and economic activity generated by the major industrial groups involved in the Super Hornet, including engine-maker General Electric Co., will greatly outpace the minimum ITB package over the next decade.
"Canadian aerospace firms stand to benefit greatly with Boeing's ITB proposal. We project that between Boeing and the Super Hornet industry team, the direct spend on the Canadian aerospace sector will exceed over $18-billion over the next 10 years, far exceeding the stated ITB requirements," the company added.
Sahir Khan, of the University of Ottawa's Institute of Fiscal Studies and Democracy, said there is irony in the fact that Boeing is heralding the potential offsets from the fighter jet contract at the same time as it criticizes government subsidies to Bombardier.
According to Mr. Khan, who is a former assistant parliamentary budget officer, regional benefits are in fact government subsidies for the Canadian industry hidden in major military contracts.
"All else being equal, offsets tend to increase the cost of acquisition and sustainment with the positive tradeoff being jobs and technology transfer to the acquiring country," Mr. Khan said. "From a policy point of view, offsets must be viewed in comparison to other program instruments such as direct subsidies, tax incentives, loans, wage/training credits in terms of both costs and potential impact."
The US State Department has approved a possible Foreign Military Sale to Canada of ten F/A-18E Super Hornet aircraft besides weapons, radars and communication systems altogether worth US$5.23 billion
The Canadian government is looking at buying second-hand fighter jets from Australia instead of buying a new fleet of 18 Super Hornets from Boeing. The government is refusing to sign a planned multibillion-dollar contract for Super Hornets as long as Boeing pursues its complaint against Bombardier at the International Trade Commission in the US,
Canada federal officials stated Thursday that they have been instructed to break off contact with Boeing over the future of Super Hornet fighter jet. The liberal governments trade conflict with Boeing over the future of the Super Hornet fighter jet purchase escalated Thursday with an acknowledgement that federal officials have been instructed to break off contact with the U
Ottawa has written to the U.S
The Canadian Government may sign a bilateral agreement with the US to purchase 18 new Super Hornet aircraft and elements of associated in-service support as soon as the end of 2017 or early 2018. Public Services and Procurement Canada (PSPC) has released an update indicating that the negotiations are proceeding
Canada government has started to negotiate with USA about sole-source purchase of up to 18 F/AQ-18 Super Hornet jet fighters from the US. The move, intended as a stopgap solution to ease pressure on the air force's aging fleet of CF-18s, could cost taxpayers between $5 billion and $7 billion over the lifetime of the aircraft, according to data circulating within the Department of National Defence,
Canada will receive the first two of 18 used Australian F-18 fighter jets in 2019. The first two used Australian F-18s to be delivered in 2019, Canadian procurement minister Carla Qualtrough was quoted as saying by
Boeing has commented that it will not have the opportunity to grow its supply base, industrial partnerships and jobs in Canada as a result of the Canadian governments decision to purchase used F/A-18 ‘Classic Hornet fighter jets. Canada last week decided to purchase used F/A-18 Hornet jets from the Royal Australian Air Force in lieu of new Super Hornet fighter jets from Boeing
The Canadian government will announce its intention to buy a used fleet of older Australian F-18 fighter jets scrapping the plan to buy 18 new Super Hornets from Boeing. The decision comes amidst growing dispute with the US aerospace company,
The Canadian government has submitted an expression of interest to buy used Boeing F/A-18 Hornet fighter jets from Australia amidst a trade dispute with the United States. "Canada expects to receive a response by the end of this year that will provide details regarding the availability and cost of the aircraft and associated parts that Canada is considering," the Canadian government said in a statement yesterday
Boeing has won a $30 million modification contract to continue to provide life cycle support efforts, such as ancillary engineering and technical, test, production, logistical support for the Small Diameter Bomb I weapon system. The modification increases the existing contract's maximum ceiling value from $80 million to $110 million, the US department of Defense said in a statement Monday
The Canadian Prime Minister Justin Trudeau said Monday that Canada would not do business with a company that is busy trying to sue them. Trudeau said that Boeing can forget about selling fighter jets to Canada as long as its trade complaint is ongoing against Bombardier
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