The U.S. ruled in favour of Boeing and, resulting in Bombardier facing duties of nearly 300 per cent on sales of its C-Series civilian passenger aircraft in America.
Unions representing Bombardier workers in both Canada and Northern Ireland called today's Montreal meeting with the company's CEO "positive" in light of USA plans to impose a heavy tariff on C-series planes. Bombardier has denied it has engaged in unfair trade practices.
Canada's purchase of the Australian jets is largely considered a stopgap for the country, which wants to replace its entire fleet of aging fighter jets.
Canada has scrapped plans to buy 18 Boeing jets and made clear the company had little chance of winning a much larger contract unless it dropped a trade challenge against Canadian planemaker Bombardier. "If there's economic harm to Canada, if there's an impact on Canadian jobs, if there's an impact to some of the key sectors of the Canadian economy, you will be at a distinct disadvantage".
Bains and other ministers said they wanted to deal with "a trusted partner".
But procurement minister Carla Qualtrough left the door open for Boeing to change its stance.
But Trudeau is not a fan of the F-35 and the Boeing spat means officials are prepared to look at rivals such as the Eurofighter Typhoon and Dassault Aviation SA's Rafale jet, say the sources, who asked to remain anonymous given the sensitivity of the situation.
"We won't do business with a company that is busy trying to sue us and put our aerospace workers out of business", Trudeau said earlier this year.
Canada's government has launched a fresh attack in the row over the United States imposing import tariffs on airliners built by Bombardier, a move which threatened UK jobs.
Boeing spokesman Scott Day pointed out in response to what is being called the "Boeing clause" that the firm employs a significant number of Canadians.
In a statement, Boeing said it would decide at the appropriate time whether to take part in the competition. He said Boeing believes that global trade only works if everyone plays by the same rules -which wasn't the case for Bombardier, he added. The value of the deal will be around C$500m. Any company is welcome to bid, though officials emphasized a Canada-first policy that would continue with future procurements.
Despite that language, Canada dangled both a carrot and stick in the fighter announcement, saying the government would not assess the economic impact of each bid until late 2019 or 2020.
"With respect to the new policy today, anyone can apply".
Government officials also announced Tuesday that Canada will proceed with the purchase of used F-18 jets from Australia.
"Will the prime minister take responsibility and admit we are never going to get new jets?" The sale, which includes 18 planes and spare parts, needs approval from the USA government.
That would mark a reversal in Lockheed's fortunes after Liberal leader Justin Trudeau campaigned in 2015 on a promise not to buy the firm's F-35 stealth fighter. "We know these aircraft extremely well", he said.
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