BELFAST (Reuters) - Yards from what is left of the giant Belfast shipyard that built the Titanic, the remaining jewel in Northern Ireland’s industrial crown - a cutting-edge Bombardier (BBDb.TO) wing factory - is under threat from a far-off trade war.
The United States on Tuesday imposed a preliminary 220 percent duty on Bombardier’s CSeries next-generation passenger jet after rival Boeing (BA.N) complained of unfair subsidies, dealing a major blow to the Canadian company’s flagship project.
The dispute has ramifications far beyond the docklands and livelihoods of Bombardier’s 4,200 workers in Belfast, with U.S President Donald Trump’s relations with Canada, British Prime Minister Theresa May’s parliamentary majority and prospects for a British post-Brexit trade deal with Washington also at stake.
“This will be a hammer blow if this stops in any way the CSeries program, because the CSeries is the future of Belfast,” said Davy Thompson, who represents the plant’s workers for the Unite trade union. He described the decision as “unbelievable.”
The fate of the workers, he fears, is being whirled about in a geopolitical storm.
“We’re hoping Belfast won’t be collateral damage,” he said.
The Commerce Department penalty against Bombardier will only take effect if the U.S. International Trade Commission (ITC) rules in Boeing’s favor in a final decision expected in 2018.
Boeing, the world’s largest aerospace company, says it is upholding trade rules and is not trying to damage the CSeries.
The Bombardier plant is by far the most important manufacturer left in Belfast, which was one of the world’s great industrial cities when the Titanic set sail as the largest ocean-liner a century ago.
After the slow collapse of British shipbuilding and the bloody three-decade conflict between Irish nationalists who wanted Northern Ireland to unite with Ireland and unionists who wanted it to remain British, only a handful of small industrial manufacturers remain.
The plant - which Bombardier bought from Short Brothers, the world’s oldest planemaker, in 1989 - has been a pillar of Belfast’s economy for decades, putting locals through multi-year apprenticeships. Thousands more jobs across Northern Ireland depend on supplying the plant.
“You can’t overstate the significance of Bombardier to our regional economy,” said local parliamentarian Gavin Robinson. “It’s the largest high-tech manufacturer in Northern Ireland. But it’s the main part of our aerospace, defense and security industry as well.”
Around 1,000 of the plant’s employees work on carbon fiber wings for the CSeries using a fabrication method perfected in Belfast, which allows Bombardier to go from raw material to finished wing on one site.
“It’s the only plant in the world where the details are made on the same site that they are assembled,” engineer Mark Braniff told Reuters in the vast hall that houses the assembly line, as a worker nearby checked an upright wing for imperfections.
“The likes of Airbus and Boeing would fly parts in from 1,000 miles away and screw them together.”
The new system allows Bombardier technicians to quickly and cheaply shape a flexible carbon fabric before infusing it with resin, rather than using a pre-made material. The finished wings are sailed from Belfast harbor for assembly in Canada.
While the resin-infusion process is not yet ready for the volumes used by the world’s largest manufacturers, it could lay the foundation for cheaper and faster ways to build the kind of composites essential to improve fuel efficiency in the world’s passenger fleet.
Other manufacturers, such as Boeing, are looking at the technology, but so far no-one else is using it on this scale.
The plant is of particular significance to Northern Ireland’s mainly protestant unionist community who long provided the vast majority of workers in Shorts and the neighboring Harland & Wolff shipyards, which built the Titanic.
Located in overwhelmingly protestant East Belfast, the plant still employs more Protestants than Catholics even after decades of equality programs.
That means the plant and its workers is central to Northern Ireland’s largest unionist party, the Democratic Unionist Party, which is propping up Theresa May’s government after a poor showing for her Conservatives in the last election.
“The UK government understands very much what is at stake here and the importance of the CSeries program,” said Haley Dunne, Director of Public Affairs at Bombardier in Northern Ireland.
Locals have been hoping that May’s dependence on the DUP will ensure she acts decisively to protect the plant.
“I‘m not sure we would have had as much traction as quickly had we not been in the position we are in,” said Gavin Robinson, the local member of parliament for the DUP.
That optimism was bolstered on Wednesday when Britain’s defense secretary warned the U.S. ruling could jeopardize Boeing’s relationship with Britain, one of its biggest overseas defense clients.
“Boeing has significant defense contracts with us and still expects to win further contracts. Boeing wants and we want a long term partnership but that has to be two-way,” Michael Fallon told reporters at the Harland & Wolff shipyard in Belfast.
May, who said she was “bitterly disappointed” by the Bombardier ruling, will have to balance placating the DUP with the need to secure an advantageous trade deal with the United States for when Britain leaves the EU in 2019, however.
“We have a weak government coming out of Brexit who need to have trade deals in place in a couple of years,” said Unite’s Thompson.
“We want them to be firm for UK workers and as strong as possible when dealing with Boeing,” he said. “We don’t want Belfast to be the casualty in all of this.”
Additional reporting by Amanda Ferguson; Editing by Sonya Hepinstall