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Bombardier presses on with effort to sell new airliner, despite trade rows

Fred Cromer, president of Bombardier Commercial Aircraft, is photographed in front of a CS100 aircraft in a 2015 event in Toronto.

Darren Calabrese/The Globe and Mail

Bombardier Inc. is pressing ahead with sales campaigns around the world for its C Series airliner in the face of trade challenges from the United States and Brazil, saying the industry wants the innovation the airplane brings and shouldn't be stuck with older, inferior aircraft.

Just days ahead of the most important airshow of the year at Paris's Le Bourget airfield, Fred Cromer, Bombardier's President of commercial aircraft, struck a confident tone when asked about trade challenges against the plane maker's flagship C Series that have dominated news headlines in recent months.

Mr. Cromer said the complaints by U.S.-based Boeing Co. and Brazil's Embraer are having no negative effect on Bombardier's efforts to sell the C Series plane and that the company welcomes the attention. He said his rivals are trying to smother the natural technological progress the sector needs for narrowbody aircraft.

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"I don't think it's slowing us down at all," Mr. Cromer told reporters on a conference call Thursday when asked specifically about Boeing's latest challenge.

"This complaint, it's a little bit of a detractor. But at the same time, the industry wants innovation. We're delivering innovation. We sort of view this complaint as a way to stifle innovation and direct people to existing products that don't deliver the same economics and the same superior performance in this size aircraft that we're delivering."

The C Series, Bombardier's new 100 to 150-seat plane, is the first clean-sheet design of a single-aisle airliner in nearly 30 years. It is the company's big bet to drive aerospace revenues over the next generation.

Boeing in April petitioned the U.S. Department of Commerce and U.S. International Trade Commission to investigate the C Series, alleging Bombardier used government aid for the aircraft to offer it at less than fair value to U.S.-based customers. Boeing is asking the United States to impose tariffs on the plane when it gets sold into the country. A preliminary decision on the matter earlier this month went against Bombardier as a U.S. trade court ruled Boeing might have been harmed by the C Series.

The allegations opened a new battle in a growing trade war between the United States and Canada. Many industry observers believe Boeing is taking advantage of a new mantra in the Trump-led White House to get tough on trade. U.S. President Donald Trump has also complained about the protection Canada offers its dairy farmers and a separate fight over softwood lumber continues.

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Brazil in February filed a separate complaint to the World Trade Organization against Canada's aid for Bombardier. The country acted on allegations by home-grown plane maker Embraer that the federal government's $372.5-million cash pledge for Bombardier earlier this year amounts to illegal subsidies that distort the global market for airplanes.

Mr. Cromer said potential customers are more focused on how the C Series might fit into their fleet plans and operations than about the trade disputes. He said the specific sales campaigns that are at issue in the Boeing complaint involve 100-seat aircraft, a product Boeing does not even offer. "I think the facts are going to be on our side," he said.

Others aren't so sure.

Ottawa-based trade consultant Peter Clark has said he believes it is unlikely Bombardier will prevail. He argued Washington has changed the U.S. trade remedy system in recent years to favour complainants, not respondents. "The chances of a [final] injury finding are much higher than the chances of Bombardier being let off," he said.

Bombardier has won orders for 360 C Series aircraft as of the end of 2016, meaning its output is essentially sold out through 2020. The smaller 110-seat CS100 model has a list price of $79.5-million (U.S.) while the larger 130-seat CS300 goes for $89.5-million.

Order activity in the industry for planes of all sizes is slow at the moment. Montreal-based Bombardier hasn't announced a major new order for the C Series in 14 months. Two airlines are currently flying the aircraft as launch customers: Deutsche Lufthansa AG's Swiss and Air Baltic.

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Despite the soft market, interest in the C Series is growing, Mr. Cromer said. If his team can build on that enthusiasm and get closer to clinching deals, the Paris air show will be positive for the company, Mr. Cromer said.

"You go there and you show your product line, you continue to generate interest and you advance your conversations," Mr. Cromer said. "To me that's success."

Bombardier will have a C Series plane on the ground in Paris in a bid to put a spotlight on its interior features.

The aircraft boasts seats that are 18 inches wide in the economy cabin, giving passengers more room than normal, with middle seats offering even more comfort at 19 inches. It also has big overhead bins and more spacious lavatories than other planes of its size. Bombardier is trying to bring the kind of comfort normally associated with widebody planes that jump across oceans to narrowbody planes flying much shorter distances.

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