A trade dispute between airline rivals Boeing and Bombardier has thrown the UK government into the mix, and Prime Minister Theresa May could soon be taking on Boeing head to head.
Trade Dispute Between Boeing and Bombardier
At first glance, the dispute may seem to not involve the UK—after a complaint by Boeing, the U.S. Department of Commerce recently decided to slap more duties onto the Bombardier C Series aircraft, with tariffs that could total nearly 300% of the planes. The move makes Bombardier planes much more expensive in the key U.S. market. What involves the UK is that many parts for the planes are built at a Bombardier facility in Belfast, which means that if production slows or halts as a result of the tariffs, more than 4,000 jobs in Northern Ireland are at risk.
May is being pressured to join forces with Canada, home to Bombardier, to take on Boeing, with the UK’s main opposition party telling May she should give Boeing CEO Dennis Muilenberg a “dressing down” to stop the dispute. May recently dropped strong hints that the government will stop ordering Boeing planes.
“Of course we have a long-term partnership with Boeing and various aspects of government, and this is not the sort of behaviour we expect from a long-term partner,” May said. “It undermines that partnership.”
Labour leader Barry Gardiner has been vocal in his thoughts that May and the EU should weigh in more forcefully in the situation, especially when it comes to fighting against Boeing to protect the rights of the workers. It was Boeing’s actions that led to the U.S. administration putting anti-dumping and countervailing tariffs on Bombardier planes, which means that in Gardiner’s mind, Boeing is the company to face off with in the battle.
Regardless of who comes out on top, a long and drawn out process could still potentially take jobs away from Northern Ireland, Gardiner said. Because of that, it is important that May does more than just threaten Boeing with words—she needs to follow through with actions.
Political Consequences with May’s Decision
May must weigh her response to the situation carefully. The dispute threatens more than 4,000 jobs in Northern Ireland, which is one of the poorest parts of the UK and an area that could seal her political fate. May depends on votes from 10 lawmakers of the region’s Democratic Unionist Party to pass her agenda on to Parliament. The push from the Labour Party to stand against Boeing is also powerful given May’s rocky political position after a disastrous election and recent plot from within her own party to oust her. Labour is next in line if May were to step down or being driven out of power.
However, Boeing is still a major employer, and fighting against the aviation giant could alienate the U.S. and Donald Trump just as May is trying to negotiate a free trade deal for after the UK leaves the EU.
May said she is working with Canadian prime minister Justin Trudeau for a different solution to the tariffs.
“I want the UK to be a global champion of free trade. Those who believe in it need to stand up and explain the benefits and show how free trade is important in raising living standards,” she said. “Those are discussions we need to have because I see protectionism creeping in around the world.”
However, some union and business groups are wondering how much power May has to actually advocate for Bombardier and make any change happen, noting that her political power and standing seems to be dwindling by the day.
May’s response to the aviation trade dispute could set the stage for future political moves both in the UK and around the world. What she chooses to prioritise in her actions will showcase the UK to the world and potentially impact future trade and international relations.
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