Britain told US planemaker Boeing on Wednesday that it could lose out on future British defense contracts because of its dispute with Canadian rival Bombardier which has put 4,200 jobs at risk in Northern Ireland.
The U.S. government moved to impose tariffs on Canadian jetliners Tuesday when it ruled in favor of a complaint by U.S. aircraft maker Boeing that claimed rival Bombardier is receiving unfair government subsidies.
The US has announced that it will be taxing C-Series jets made by the Canadian company, which employs hundreds of people in Northern Ireland, with a 220% import tariff.
The Defence Secretary Sir Michael Fallon has warned that Boeing's trade dispute with Bombardier could threaten its trading relationship with the government, along with thousands of jobs in Belfast.
The U.S. planemaker has argued that the C Series wouldn't exist without the assistance, noting that the company received money from the Canadian and Quebec governments to develop the plane and further aid from both in recent years to shore up the company's finances. The preliminary decision by the trade commission for a 219.63% tariff was steeper than the 160% recommended by Boeing.
He said Britain wanted to see the dispute resolved through a negotiated settlement.
Commerce officials are expected to rule next month on whether Bombardier "dumped" planes into the US market, which could result in more temporary duties. Canada "strongly disagrees" with the USA probes into its aircraft, Foreign Affairs Minister Chrystia Freeland said in a statement.
The scale of the tariff was higher than what Boeing had sought, and Bombardier could be hit by even more tariffs as the regulatory process continues.
Bombardier's discount deal with Delta Airlines was expected, considering it was introducing a new jet, Baskin said.
But concerns have been raised in the United Kingdom that thousands of jobs will be put at risk by the ruling.
Boeing's complaint arose after Northern Ireland's powersharing administration and the UK Government pledged to invest nearly £135 million in the establishment of the C-Series manufacturing site in Belfast.
That decision isn't expected until sometime next year, possibly May or June.
The discount airline urged the US regulators to deny Boeing's petition, saying imposing tariffs on the CSeries would harm competition and result in higher airfares.
Theresa May has twice lobbied US President Donald Trump on the matter and met with Canadian Prime Minister Justin Trudeau ahead of the ruling. For years, the United States lumber industry had complained that because Canadian lumber is subsidized by the government, the imports make it hard for American companies to compete.
"This is about defending an industry which is providing more than 200,000 jobs in Canada and 300 suppliers across the country, so obviously we'll be steadfast in our defense of Bombardier", he said. During the 2016 competition, Boeing offered Delta, the second largest USA airline, used jets from another manufacturer.
The dispute stems from a 2016 Delta order from the Montreal-based air and rail giant for as many as 125 C Series aircraft.
A US naval air crew walks the flight line in front of a squadron of Super Hornet fighters at Naval Air Station Oceana, Virginia on January 26, 2017.
The case will now be considered by the US International Trade Commission for a final ruling in February.
Northern Irish Democratic Unionist Party (DUP) leader Arlene Foster, on whom May relies for her parliamentary majority in Westminster, also said that the United States move to impose steep tariffs was "very disappointing".