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Bombardier and Boeing are in a fight to see who can rip off more people
Last week, Boeing filed an anti-dumping and countervailing-duty petition with the U.S. government, complaining that Bombardier is selling subsidized C-Series aircraft below cost on the American market. Arguments can be marshalled for either side. (business.financialpost.com) Daha Fazlası...
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The opinion piece in AW&ST also describes how Boeing dumped 787s well below cost to Air Canada, which promptly sold and leased back some and turned a profit, as well as not paying the full amount in the first place.
I'm quite sure that the Boeing sales staff trying to sell Super Hornets to Canada all yelled "WTF?" in unison when the head office launched this complaint.
I'm quite sure that the Boeing sales staff trying to sell Super Hornets to Canada all yelled "WTF?" in unison when the head office launched this complaint.
Agreed.
Bombardier does have one major advantage: it has no healthcare costs for its employees. No doubt Boeing is paying through the nose to insure its workers and their families. After the massive increases over the past few years this has to be a major factor in the Boeing cost structure.
Bombardier does have healthcare costs for its employees and families as do most companies with benefits
At the most, Bombardier "tops up" the government-funded health care that all Canadians have. Some companies, especially if their employees are unionised and have negotiated for it, add additional coverage such as dental, glasses, etc that aren't part of the government system. That is still far cheaper than the company paying for the whole thing. However, the corporate tax rate is higher in Canada -- even before the current U.S. regime's tax cut plans for corporations and the rich.
Corporate tax will only be on profits which will be company wide and development costs will be written off so it is unlikely Bombardier is paying any taxes related to the C-Series, nor will it for a number of years. Canada's rate is lower than the USA unless Trump is able to put through his 15%.
Bombardier took money from the Quebec government in exchange for ownership, no different than selling a preferred stock. The money from the Feds is a loan which will be repaid from profits. It will be difficult for Boeing to prove the subsidies unless of course they go to the 9th circuit.