Airbus to take majority stake in Bombardier C-Series jet programme

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The U.S. recently announced it would impose an 80 percent duty comes on top of duties of almost 220 percent.

The agreement between Airbus and Bombardier aims to allow for significant production savings on the C-Series aircraft and to make use of Airbus's global reach for sales, the two groups said in a statement.

Enders said some airlines have been reluctant to purchase Bombardier's plane because of doubts the program would continue. Not only will this partnership secure the C Series and its industrial operations in Canada, the United Kingdom and China, but we also bring new jobs to the US.

During a conference call for the airline's third quarter results, Delta chief executive Ed Bastian said the duties imposed on the C-Series were "nonsensical", and vowed not to pay the additional tariffs.

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The move by Bombardier could possibly circumvent duties being imposed on the C Series.

Enders denied that Airbus got involved in the C Series because of Boeing's trade complaint.

"Airbus is the ideal partner for us, Quebec, and Canada", he added.

Enders said the talks started in August and were not motivated by what competitors are doing.

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But he later said that by assembling the C Series in Alabama, those planes delivered to US airlines "wouldn't be subject to duties" the Commerce Department has proposed. The deal also provides Airbus warrants exercisable to acquire up to 100m Class B Shares of Bombardier, the companies said. "This partnership should more than double the value of the C Series programme and ensures our remarkable game-changing aircraft realises its full potential".

Airbus will acquire a 50.01 percent interest in Bombardier's C Series Limited Partnership, the companies said in a joint news release.

Bombardier will own 31 per cent and the Quebec government's investment agency will hold 19 per cent.

Chicago-based Boeing's complaint claims Bombardier's new C Series passenger aircraft receives Canadian government subsidies that give it an advantage internationally.

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France's Airbus is a much bigger player than Bombardier in the lucrative narrow-body jet market but faces pressure to consolidate as new competitors from China and Russian Federation are set to deliver new narrow-body jets as early as 2019.

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