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Short Summary
Main recommendation: The video's central conclusion is that Bombardier's CSeries, a small plane built for the mid-size market between regional jets and Boeing/Airbus aircraft, became commercially viable in the crucial US market after Airbus took a stake in the program in response to a Boeing-driven trade fight. Boeing's dumping petition and the resulting U.S. tariffs made the plane nearly impossible to sell in its key market, and Airbus's acquisition and U.S. assembly line changed that.
Key Points
- Small planes are a significant market that Boeing and Airbus have failed to dominate, while Embraer's E-jet family has sold nearly 1,500 units and serves airports like London City.
- Bombardier's CSeries faced serious setbacks, including an uncontained engine failure during ground testing that disrupted its schedule and kept it from exhibiting at the Farnborough airshow.
- The program was nearly out of money by 2015 and survived largely because of financial support from the governments of Canada and Quebec.
- Bombardier allegedly sold 75 planes to Delta at about $20 million each, a quarter of the list price, which Boeing challenged as dumping.
- The U.S. Department of Commerce placed a 300 percent tariff on the plane, which made competing in the U.S. market effectively impossible.
- Airbus's 50.01 percent stake, announced October 16, 2017, let the plane be assembled in Mobile, Alabama, which Bombardier argued would exempt it from tariffs, though Boeing disputes this, and the outcome was left up to the US Department of Commerce.
Details Worth Noting
- Concrete instructions: The video gives no step-by-step instructions for a viewer to follow. Its only actionable-style content is the business and trade analysis of how the CSeries was rescued, which is descriptive rather than directive.
- Delta reportedly bought the planes for $20 million each against an $80 million listing price, and Bombardier's estimated cost to build one was about $30 million, which is why the pricing was alleged to be predatory.
- Boeing said it received over $14 billion in subsidies over 20 years through U.S. state and federal tax breaks, while the Canadian and Quebec money to Bombardier came as either ownership exchanges or interest-free loans to be repaid.
- Boeing asked for an 80 percent tariff, and the Commerce Department went further with 300 percent; the tariff's application depends on the share of the plane made outside the U.S., reported as about 48 percent.
- Independent analysts estimated demand for about 5,500 CSeries-sized aircraft over 20 years, with Bombardier expected to capture about 40 percent before the takeover and Airbus-era projections of up to 60 percent.
Bottom Line
The CSeries survived mainly because of government backing and an Airbus partnership that sidestepped a U.S. tariff fight, and the video presents Boeing's trade actions as having backfired by handing a competitor a ready-made product.
