Bombardier Bonds Tumble as U.S. Slaps Import Duties on C-SeriesBy
Bombardier Inc.’s euro-denominated bonds maturing in 2021 have declined the most in more than two years after the U.S. imposed import duties of 220 percent on the company’s C-series plane, threatening to upend deliveries of more than $5 billion to Delta Air Lines Inc. next year.
The Canadian aircraft and train manufacturer’s senior unsecured notes are currently down by more than seven price points at 99.963, according to Bloomberg prices at 10am London time. The notes had already fallen 2.2 points on Tuesday -- the same day that competitors Siemens AG and Alstrom SA agreed to join their rail businesses.
The penalties create a new hurdle for Bombardier’s Chief Executive Officer Alain Bellemare, who is trying to turn the company around after the C-Series came in more than two years late and $2 billion over budget.
U.K. Prime Minister Theresa May earlier said, “I am bitterly disappointed by the initial Bombardier ruling. The government will continue to work with the company to protect vital jobs for Northern Ireland.” Bombardier is the largest manufacturing company in Northern Ireland; its rail division employs ~3,500 in the U.K., according to the company’s website.