DECEMBER 6, 2017
OTTAWA (Reuters) - Canada is scrapping a plan to buy 18
Boeing Co (BA.N)
Super Hornet fighter jets amid a deepening dispute with the U.S. aerospace
company, three sources familiar with the matter said on Tuesday.
Instead, the Liberal government will announce next week
it intends to acquire a used fleet of older Australia F-18 jets, the same kind
of plane Canada currently operates, said the sources, who asked not to be
identified because of the sensitivity of the situation.
The move underlines Ottawa’s anger at a decision by
Boeing to launch a trade challenge against Canadian planemaker Bombardier Inc
(BBDb.TO), which the U.S. giant accuses of dumping airliners on the domestic
American market.
It also casts into question the future of Boeing’s
military sales in Canada. Boeing says its commercial and defense operations in
Canada support more than 17,000 Canadian jobs.
Canada and Mexico are currently locked into increasingly
acrimonious negotiations with the United States over the NAFTA trade pact,
which President Donald Trump says has not done enough to protect U.S. jobs.
The Liberal Party of Prime Minister Justin Trudeau
initially said in late 2016 it wanted the Boeing jets as a stopgap measure
until it could launch a competition for a permanent fleet to replace Canada’s
ageing CF-18 jets.
But as relations with Boeing deteriorated, Ottawa slammed
the firm for not acting as a trusted partner and began looking at the
Australian jets.
Two of the sources said Australian military officials had
been in Ottawa late last month for talks.
One source said that by buying the Australian fleet,
Canada would save money as well as avoid the need to train its pilots on a new
aircraft or spend money on a new supply chain.
Officials had previously said that if the purchase went
ahead, some of the Australian aircraft would be used for spare parts.
The offices of Public Works Minister Carla Qualtrough and
Defence Minister Harjit Sajjan, who share responsibility for military
procurement, both declined to comment.
Boeing declined to comment. The Australian mission in
Ottawa was not immediately available for comment.
Canada is due to officially announce the requirements for
its new fighter fleet in early 2019, kicking off an open competition.
One potential contender is Lockheed Martin Corp’s (LMT.N)
F-35 fighter, which Trudeau initially said he would not buy because it was too
expensive. The government has since softened its line, saying the plane would
be allowed to compete.
Original post: reuters.com
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