The partnership between Bombardier and European aerospace giant Airbus, should "safeguard" 1,000 jobs at risk in the North, at least in the short term and could also signal a new direction for Bombardier's Belfast operations, according to a leading economist.
Bombardier has signed a deal to bring Airbus on board its C Series aircraft programme, giving the European aerospace giant a majority stake in the C Series’ future.
According to the trade union Unite, more than 1,000 people, 25 per cent of the workforce, in Bombardier’s Belfast operations are currently employed directly in the manufacture of wings for the C Series aircraft.
The union has cautiously welcomed the Bombardier and Airbus deal, which it believes will at the very least give the C Series “breathing space”. It said the agreement “should safeguard the future of C Series production jobs in Belfast for the foreseeable future”.
Airbus, which will not pay a cent for its 50.1 per cent stake in the C Series programme, will take control of all sales and marketing operations, and also develop additional C Series production facilities at Airbus's existing manufacturing site in Alabama in the United States.
According to Dr Graham Brownlow, lecturer in economics at Queen's University, this is a crucially important development for Bombardier, its Northern Ireland workforce and its suppliers because it will likely mean that the C Series may no longer be subject to massive tariffs that the US department of commerce had planned to impose on the planes coming into the US.
Rival Boeing
The commerce department had investigated claims by rival Boeing that Bombardier was selling its C Series aircraft below the cost of production in the US and had decided to slap import duties of 300 per cent on each C Series aircraft sold in the key market.
If Airbus relocates final production of the C Series, as outlined, to its existing manufacturing site in Alabama, Dr Brownlow said it might cancel out the rationale for the proposed tariffs because the aircraft will be manufactured on US soil.
He said the partnership was significant for Northern Ireland because it means one of the world’s biggest aviation players now has a new role of influence with one of largest private sector employers in the region.
“On balance, the C Series partnership between Bombardier and Airbus is good news for Northern Ireland because of the influence that Airbus can bring to bear,” he said. “If you are a niche player and you are not affiliated with one of the two big aviation players – Boeing or Airbus – then you are vulnerable.
“Bombardier was to be hit by tariffs of 300 per cent in the US. This deal with Airbus secures Bombardier’s C Series future and that can only be a good thing for Northern Ireland,” Dr Brownlow said.
According to Davy Thompson, Unite regional co-ordinating officer, the agreement could also help Bombardier increase the number of people it employs on the C Series programme in the North in the long term.
The union believes the agreement will help Bombardier to “leverage Airbus’s global scale and reach, and open access to their supply chain”. It hopes this will translate into additional sales.
‘Great news’
Mr Thompson said the union had been given assurances that the manufacture of the C Series wings would remain at Bombardier’s Belfast facility which overall employs about 4,500 people.
Michael Ryan, president of Bombardier's aerostructures and engineering services and the man in charge of its Northern Ireland operations, said the partnership with Airbus is "great news for our Belfast site".
“This is a tremendous opportunity for us to build on our existing supplier relationship with Airbus,” he said, adding that it would strengthen the C Series aircraft programme on the international market.
But it appears Boeing is not prepared to give up its fight just yet.
Commenting on the move, a Boeing spokesman said: “This looks like a questionable deal between two heavily state-subsidised competitors to skirt the recent findings of the US government. Our position remains that everyone should play by the same rules for free and fair trade to work.”
Some aviation analysts have warned the US commerce department may also view the agreement as a new “trade circumvention” move to avoid tariffs on the C Series which could lead to a fresh investigation.
