Published: Thu, December 07, 2017
Business | By Max Garcia

Canada scraps plan to buy Boeing fighters amid trade dispute

Canada scraps plan to buy Boeing fighters amid trade dispute

Boeing has lost an order from Canada for 18 Super Hornet fighter jets, a deal that was worth up to $6.4 billion.

Three sources familiar with the matter told the news outlet that Canada will instead announce next week that it will purchase a used fleet of Australian F-18 jets, which Canada already operates.

The Canadian government has canceled a planned fighter-jet purchase from Seattle-based Boeing, apparently in retaliation for a trade dispute with the Trump administration, the Reuters news service reported Tuesday.

Read the whole story from Reuters.

The offices of Public Works Minister Carla Qualtrough and Defence Minister Harjit Sajjan, who share responsibility for military procurement in Canada, both declined to comment.

The Super Hornets were supposed to help tide Canada over as it holds a competition for fighters to replace 77 veteran CF-18s. "It has to be a two-way street, there has to be this mutually beneficial relationship for it to be one that grows, one that both sides are happy and excited about".

The move to try to acquire fighter jets from Australia coincides with the US government's decision, based on a Boeing complaint, to hit Bombardier with nearly 300 per cent duties on its CSeries civilian passenger jet.

In buying older Australian Super Hornets, Canada would be buying a cheaper aircraft, not need to retrain its pilots, nor spend money on a new supply chain, one source said. At the time, Prime Minister Justin Trudeau and his top ministers said Ottawa would not do business with Boeing as long as it was engaged in a dispute with Bombardier.

Canadian officials participating in the NAFTA talks criticized the Commerce Department's tariff decision, with Foreign Affairs Minister Chrystia Freeland saying Canada "strongly disagrees" with the USA probes into its aerospace industry.

Bombardier denies any wrongdoing and says Boeing can not prove it was harmed by the Canadian company's actions because it did not offer Delta any planes of its own.

At a conference in Boston in November, Bombardier CEO Alain Bellemare said: "Boeing is underestimating what they are tackling". It has been the standard line in Ottawa for months that Boeing, having failed to act as a trusted or valued partner, has effectively been shut out of any new federal contracts.

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