Bombardier shares drop 9% as Trump threatens Canada with aircraft tariffs

• Trump threatened 50% import tariffs on all Canadian aircraft until Canada certifies the latest U.S.-made Gulfstream planes
• Bombardier's stock dropped 9% following the tariff threat announcement on Thursday night
• The White House later clarified that currently operational Canadian-built planes would not be decertified, though uncertainty remains in the aviation market

Summary

Bombardier shares plunged 9% following President Trump's threat to decertify the Canadian private jet manufacturer's large cabin aircraft and impose 50% import tariffs on all Canadian aircraft. The threat was issued Thursday night and is contingent on Canada's aviation regulator certifying the latest aircraft from U.S. competitor Gulfstream.

A White House official later clarified that Trump was not proposing to decertify Canadian-built planes currently in operation. However, the president's warning created significant confusion and concern across the aviation industry, affecting airlines, aviation analysts, and private jet buyers and owners.

Market Impact:

The 9% share price decline reflects investor anxiety over potential regulatory and trade barriers that could severely impact Bombardier's business operations. The threatened 50% tariff would substantially increase costs for Canadian aircraft imports into the United States, potentially making Bombardier's products less competitive against American rivals like Gulfstream.

Key Context:

This development appears to be part of broader trade tensions between the U.S. and Canada, using aviation certification and tariffs as leverage points. The dispute centers on regulatory reciprocity, with Trump demanding Canadian certification of Gulfstream's latest aircraft models before allowing continued access for Bombardier's products.

Industry Implications:

The uncertainty surrounding aircraft certification and potential tariffs poses risks to the broader aerospace sector, particularly affecting private jet markets. The situation could disrupt existing orders, delivery schedules, and future business planning for Bombardier, while potentially benefiting U.S. manufacturers like Gulfstream if trade barriers materialize.

The market reaction underscores the vulnerability of aerospace companies to sudden policy shifts and trade disputes between major economies.