Well, Tom, there it is. Trying to keep up with the world according to the Dear
Leader? Good luck trying to plan anything.Â
Bob Robeson
----- Forwarded Message ----- From: Tom Ronell via Mifnet
<[email protected]>To: Bob Robeson via Mifnet
<[email protected]>Cc: Tom Ronell <[email protected]>Sent: Tuesday,
July 15, 2025 at 03:00:06 PM EDTSubject: [Mifnet 🛰 73102] Re: Delta's canny
move
from Airline Economics, a few minutes ago:
"The effects of tariffs on aircraft manufacturers have been prevalent in recent
months, particularly following the US government's introduction of reciprocal
tariffs economies worldwide in April, including the EU. These measures have
affected Airbus deliveries.
According to research by Airline Economics, Delta Air Lines earlier this year
took delivery of Airbus aircraft by flying them via Asia, in what appeared to
be a strategic move to avoid US tariffs. One A330-900 departed from Toulouse on
May 11, but instead of flying directly to the US, it landed at Tokyo’s Narita
Airport the following day.
A source familiar with the matter confirmed to Airline Economics that this
routing was part of a deliberate strategy to bypass tariffs. The approach
exploited a loophole, allowing aircraft to avoid tariffs if they operate
international routes into and out of the US.
This tactic was previously employed during the Trump administration and appears
to be resurfacing in response to the current trade environment."
From: Bob Robeson via Mifnet <[email protected]>
To: Tom Ronell via Mifnet <[email protected]>
CC: Bob Robeson <[email protected]>
Date: Jul 15, 2025 18:20:09
Subject: [Mifnet 🛰 73094] Re: Delta's canny move
Tom,
Further to my earlier reply to your question, as I lay abed last night my
fevered mind got to wondering if the US had imposed countervailing duties on
Airbus imports as a result of the dispute over European subsidies. At the time
I moved from that world to the much more interesting field of aviation safety,
we had not done so. In fact, we had not opened a formal investigation of Airbus
subsidies under the statutory authorities governing unfair international trade
practices, so I was no longer following it very closely. But my curiosity was
piqued so this morning I did a bit of digging. The US did take a complaint to
the WTO concerning subsidies to Airbus (which was countered by an EU complaint
against the US alleging subsidies to Boeing). As a result of that process the
WTO authorized the US to impose tariffs against European products. Note that
under this type of complaint, the tariffs don't need to be against the product
at issue, as the objective from the WTO point of view is to restore the balance
of trade concessions generally, which in this case could (and did) include EU
products other than aircraft. So, in 2019, the US did in fact impose a 10% ad
valorem countervailing tariff that included not only new aircraft over 30,000kg
(empty) from France, Germany, the UK and Spain, but also other tariffs on
things like whiskey (oh, the horror of it all!). However, after further
negotiations between the U.S. and Europeans, these tariffs were suspended in
July 2021 for a period of 5 years, so at present there appears again to be no
tariff on aircraft from the EU or UK.
There is a bit more to the story. The tariffs appear to cover only complete
aircraft, not parts, components etc., etc. etc. I haven't read an explanation
for that, but personally I think one could make a pretty good safety case for
leaving all of that out of the mix. Anyhow, that answers any lingering question
from Mssrs Keady and Borfitz: relax, your engines are clear of all this. For
those Mifnetters with severe insomnia, I'm attaching links to a bit of reading
for your evening pleasure. Â
Bob Robeson
This is a page from the USTR website links to documents pertaining to this
issue. The notice of determination published on October 9, 2019, has all the
information as to tariff rates, what products are covered and from which
countries. Skip to Annex B of that notice for detailed product descriptions.
The July 9, 2021 notice announced the 5-year suspension of countermeasures
i.e., tariffs.
ustr.gov/issue-areas/enforcement/section-301-investigations/section-301-large-civil-aircraft
A short note on section 301 by the law firm Covington & Burling
www.cov.com/en/news-and-insights/insights/2024/12/section-301-tariffs-and-proceedings-recent-and-potential-developments
A nice analysis by the Kiel Institute in 2019 gives one view from Germany
about how this played out at the time. Bottom line, in developing its
retaliation list, one could say that the US may have used a kitchen knife
instead of a scalpel, but it didn't use a chainsaw either. (Although, as
someone who in an earlier life worked on developing retaliation lists against
the then European Communities, I'd say a scalpel is actually pretty close to
the mark here).
www.ifw-kiel.de/publications/kiel-focus/low-countervailing-tariffs-a-warning-to-europe-in-airbus-boeing-conflict/
On Monday, July 14, 2025 at 10:00:56 PM EDT, Tom Ronell via Mifnet
<[email protected]> wrote:
If there are no tariffs on aircraft, then why is Delta taking Airbus deliveries
to Tokyo and putting them into service from there, in order to avoid tariffs by
having the aircraft enter USA as used aircraft, and Bloomberg's reporting
"...as it seeks to overcome a shortage and avoid aircraft import tariffs."?
Seems like a lot to do for no reason.
TR
From: Bob Robeson via Mifnet <[email protected]>
To: Mike Borfitz via Mifnet <[email protected]>
CC: Bob Robeson <[email protected]>
Date: Jul 15, 2025 02:13:34
Subject: [Mifnet 🛰 73084] Re: Delta's canny move
Mike & Jack,
Don't worry about tariffs. The Agreement on Trade in Civil Aircraft
eliminated customs duties (i.e., tariffs) on trade in civil aircraft and parts
among the signatories to the agreement. See Article 2 and the tariff schedules
at the end of the agreement. Now, I confess that I'm way out of date as to the
effect on this of Mr. Trump's unhinged dabbling in the world of tariffs, but it
looks like the Aerospace Industries Association is worried about it. Finally,
the item from the US Trade Representative contains a list of signatories to the
agreement (apparently USTR hasn't noticed that the UK is no longer part of the
EU, but since the EU members all signed in their own right that isn't relevant
for this discussion, but I just couldn't resist a little snark).
Cheers, Gents Bob Robeson
gatt-disputes.wto.org/sites/default/files/documents/6%20Full%20TR%20Codes/Instrument155-TCA.pdf
www.aia-aerospace.org/wp-content/uploads/AIA-Agreement-on-Trade-in-Civil-Aircraft.pdf
ustr.gov/issue-areas/industry-manufacturing/industry-initiatives/aircraft
On Monday, July 14, 2025 at 03:37:49 PM EDT, Mike Borfitz via Mifnet
<[email protected]> wrote:
Even better: They're Pratt engines, so we're talking Connecticut to
Europe then back to Atlanta or wherever, and there are duties?  Now THAT is
odd. I wonder if Pratt has final assembly in Europe?Â
On Mon, Jul 14, 2025 at 1:15 PM Jack Keady via Mifnet
<[email protected]> wrote:
keady - doesn't Airbus alreadyhave a factory in the US? I'm thinking they
could expand this to making it a final assembly or whatevr, couldn't they?
|
Delta strips engines off new Airbus jets to overcome US shortage
|
|
Delta Air Lines Inc. has been cannibalizing new Airbus SE jets in Europe by
stripping off their engines and using them to get grounded planes in the US
back into service, as it seeks to overcome a shortage and avoid aircraft import
tariffs. The airline has been taking US-made Pratt & Whitney engines off new
European-built A321neos and shipping them back to the States without any
duties, according to people familiar with the matter. The engine-less aircraft,
meanwhile, remain in Europe. Mary Schlangenstein & Siddharth Philip/Bloomberg
|
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--
Mike Borfitz, DER
Cell     206-714-8797 e-Mail:   [email protected] Kilroy Aviation
LLC Website:Â WWW.FAAODA.COMÂ Â
Kilroy is available for aviation regulatory and safety issues - Type &
Production Certification, Continued Operational Safety - International
validation & safety matters - Program & system management - FAA STC ODA
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