Bombardier

Two articles related to Bombardier caught my eye:

First, in the National Post, Andrew Coyne suggests that “it is increasingly clear the federal government, at least, views itself and Bombardier as being one and the same … [and] … This was perhaps most explicit in the prime minister’s announcement earlier this week that the government would refuse to buy military jets from Boeing, though it had earlier said it would, on the grounds that “we don’t do business with a company that’s busy trying to sue us” …[but] … Boeing, of course, is doing no such thing. The suit it has brought before the U.S. International Trade Commission is not against the government of Canada, but Bombardier. It was not Boeing that mistook the interests of the citizens of Canada for those of a private company, or that subordinated a critical military procurement decision to the Bombardier Inc. Rail Passenger Train Manufacturingoutcome of a private trade dispute. It was the government of Canada that did that;” and

Second, in the Globe and Mail, Dabiel LeBlanc and Marc MacKinnon report that “Canadian authorities have started to collaborate with their Swedish counterparts in the continuing corruption investigation into Bombardier Inc.’s $340-million (U.S.) contract to sell railway equipment in Azerbaijan, The Globe and Mail has learned … [and] … As part of the investigation into the 2013 deal, Swedish police are digging into the inner workings of the Montreal-based company with offices and contracts around the world. The trial of Mr. Pavlov has shed light on a network of shell companies that Bombardier Transportation partners with in Russia and several other countries, raising questions about international business practices at one of Canada’s flagship firms.

Andrew Coyne explained why Bombardier is a “flagship firm: “Until this week,” he says, “I had been patiently explaining to readers that the company was not, as its annual reports might suggest, in the aerospace and mass transit business. It is, I suggested, in the subsidy business. Governments, federal and provincial, periodically offer it subsidies worth hundreds of millions of dollars, in return for which Bombardier agrees to take them … [because] … That is to say, it supplies governments with the incalculable benefits that come from “rescuing” Bombardier, and thus saving jobs, advancing high-tech, defending Canada, defending Quebec, and other things politicians like to be seen doing.

The Globe and Mail also reports that Bombardier has numerous other, current, ongoing problems related to trade dispute and its rail business.

But Bombardier has been having problems, including technical/delivery problems and ethical problems, for a long time, but, hey, it’s a big employer, especially in Quebec and so it must be supported, right?

Wrong!

Bombardier has been troubled for a ling time. That’s why, when Bombardier asked the Harper government for aid officials cautioned against it unless there were major management and governance reforms. That advice was repeated to the Trudeau regime.

Prime Minister Trudeau was nearly criminally stupid to give in to Bombardier‘s pleas without securing, first, a full scale restructuring of the company to remove the family from control and to give that control to a board that answers to shareholders. Bombardier can make good planes and trains and other things … new, good better management can turn it around and make it both honest and productive … look at Chantier Davie, also a once deeply troubled Quebec “flagship firm.”

Prime Minister Trudeau also gives us another look into just how shallow his political thinking is when he ties the fate of a major defence procurement project to a really quite petty trade dispute and when he conflates our, Canadian, national standing with that of one (possibly ethically troubled) firm.

Conservatives should not threaten to throw Bombardier to the wolves … but they should promise that it will get nothing more from taxpayers until it is “clean” and better, publicly, managed.

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