June 6, 2017 / 8:27 PM / 5 months ago

Bombardier says trade dispute not slowing CSeries momentum

CANCUN, Mexico (Reuters) - Bombardier Inc (BBDb.TO) said on Tuesday it was confident of winning a trade dispute with Boeing Co (BA.N) in the United States and dismissed industry suggestions that the row could slow efforts to accelerate sales of its CSeries jet.

A logo of jet manufacturer Bombardier is pictured on their booth during the European Business Aviation Convention & Exhibition (EBACE) in Geneva, Switzerland, May 22, 2017. REUTERS/Denis Balibouse

Fred Cromer, head of commercial aviation, said a CSeries order by Delta Air Lines Inc (DAL.N) that triggered a recent Boeing complaint reflected a “launch pricing” discount common in the industry and was not an ongoing commercial strategy.

“Now that the aircraft is in service, the risk profile goes down and the pricing of the aircraft starts to move up,” Cromer said on the sidelines of the International Air Transport Association’s annual meeting in Mexico.

The U.S. International Trade Commission is expected to make a preliminary ruling by June 12 on Boeing’s complaint that Bombardier dumped the CSeries below cost in the U.S. market while benefiting from unfair Canadian subsidies.

Cromer said Bombardier’s sales and funding practices were legal and the dispute had not hurt ongoing sales efforts, which were helped by the entry into service of the CS100 last July and the CS300 last December.

He declined to say if he expected to announce any orders at the Paris Air Show this month, but said the purpose of the event was mainly to showcase new products.

“I don’t like to predict. I think we’re going to build the momentum at the Paris Air Show,” Cromer said.

Bombardier has not reported a new CSeries order in nearly a year, leading some analysts to question whether the aggressive response from Boeing’s complaint could slow further sales and effectively close its new rival out of the narrowbody market.

Cromer argued the opposite was true.

“It has actually raised the interest level,” he said. “This attention is really creating a situation where airlines around the world are saying this airplane is real. It’s in service and it’s performing well and something to be contended with.”

Cromer also said Bombardier was on track to ramp up CSeries production later this year after postponing deliveries at the end of 2016 due to problems at engine maker Pratt & Whitney, a division of United Technologies Corp (UTX.N).

“We feel very confident that Pratt is going to be there to support that delivery schedule,” he said.

“The calendar for 2017 was always a little bit backend-loaded, so ... we expect deliveries, per our plan, to start accelerating in the back half of the year.”

(This version of the story corrects date of CS300 entry into service from “last month” to “last December” in 5th paragraph)

Reporting by Tim Hepher and Brad Haynes; Editing by Richard Chang

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