3 MIN Ago: Canada's Aerospace Industry Just HUMILIATED Boeing With a $19B Asia DEAL!

Added: 2026-05-09

[00:00:00]A blockbuster deal for Airbus. The aerospace giant [music] has inked a multi-billion dollar sale. It's building new jets for Air Asia. The Prime Minister says the momentum for Quebec and the country is huge. Airbus Canada has announced a massive deal to supply Air Asia with 150 of its Canadian-made A220 jets. Canada is once again building big at home and creating reliable partnerships abroad including very much with Asia.

[00:00:31]So Tony, thank you. Thank you for the trust you're placing in Canadian workers, in Quebec, in Mirabel. You're choosing the best at exactly the right time.

[00:00:45]This is the story of how Boeing's biggest mistake of the last decade just came to bite the company in spectacular fashion.

[00:00:54]On May 6th, 2026, in a hangar north of Montreal, the largest commercial aircraft order in Canadian history got signed with a Malaysian airline placing a $19 billion order for 150 jets.

[00:01:10]Not Boeing jets. These were Canadian jets.

[00:01:15]The reason Boeing wasn't even in the running for this deal traced back to a decision Boeing itself locked in nine years earlier when the company tried to crush a Canadian competitor and ended up handing that competitor straight to Airbus for one Canadian dollar.

[00:01:32]That number is not a typo. One single Canadian dollar.

[00:01:38]If you've been following what's happening with Boeing over the last few years, the safety crises, the production caps, the door plugs falling off mid-flight, you already know the company is wounded. This story isn't about the 737 Max crashes, though. What we're talking about is a quieter, slower humiliation. The kind that doesn't make the evening news, but reshapes entire industries.

[00:02:04]It's the kind of story that makes you wonder how a company as powerful as Boeing could shoot itself in the foot this badly, this publicly, and still not have an answer for it nearly a decade later.

[00:02:16]Let's get into it, because what happened in Mirabel, Quebec on May 6th wasn't just an airplane order. It was a receipt.

[00:02:24]Here's what actually got signed.

[00:02:27]Malaysia's AirAsia, the largest low-cost carrier in Southeast Asia, placed a firm order for 150 Airbus A220-300 aircraft, with the deal announced at the Airbus facility in Mirabel, Quebec, north of Montreal.

[00:02:43]AirAsia's co-founder, Tony Fernandes, signed the agreement personally, and standing right there alongside him were Canadian Prime Minister Marc Carney, Quebec Premier Christine Fréchette, and Lars Wagner, the CEO of Airbus Commercial Aircraft.

[00:03:00]The total value at list prices comes to roughly 19 billion US dollars.

[00:03:06]Anyone who knows the aviation industry knows airlines never pay list price on a bulk order this size.

[00:03:13]Tony Fernandes himself put it this way, and I'm quoting here, "I probably got a better price because no one is buying planes. This is an opportunity to go against the grain." End quote.

[00:03:24]End quote.

[00:03:26]The actual transaction value lands substantially below 19 billion, but here's the thing, even at a steep discount, this remains the largest single firm order ever placed for the A220 aircraft, and the largest order ever placed on any Canadian-designed and produced aircraft in history, period.

[00:03:47]The list price for a single A220-300 sits at 91.5 million US dollars, and you multiply that by 150 to get the headline number.

[00:03:59]Every one of these 150 aircraft will be assembled in the Mirabel facility in Quebec, not in Mobile, Alabama, where Airbus operates a second A220 line.

[00:04:11]Mirabel, Quebec workers, Canadian hands.

[00:04:15]This part should really get Boeing's attention.

[00:04:18]AirAsia also took purchase options for another 150 aircraft of a larger variant called the A220-500, a stretched version that doesn't even exist yet. It hasn't been approved. It hasn't been built. Bemused, Tony Fernandes essentially told Airbus, "Build it, and we'll buy 150 more, which would push the total to 300 aircraft from a single customer."

[00:04:45]For context on what that means, this single AirAsia order pushed the entire A220 program past the 1,000 firm order milestone.

[00:04:55]As of the end of March 2026, 501 A220s had been delivered to 25 operators worldwide, and AirAsia just doubled the runway for this program in one signature.

[00:05:08]You might be wondering, this is an Airbus deal, so why are we calling it a Boeing humiliation? Fair question, and here's the explanation.

[00:05:17]Boeing wasn't even in the running for this contract, and the company couldn't be because Boeing currently does not sell a modern, certified, purpose-built aircraft in the 100 to 150 seat category. They simply don't have one.

[00:05:33]Explanatory, the closest thing in their lineup is the Boeing 737 Max 7, which sits closer to the Airbus A319 Neo in terms of size and positioning. And as of 2026, the 737 Max 7 still hasn't been certified.

[00:05:51]Industry expectations point to certification in the third quarter of 2026 with initial deliveries projected in early 2027.

[00:06:00]If you're an airline like AirAsia and you need a fuel-efficient narrow-body in that 100 to 160 seat range, your options come down to the Airbus A220, the Embraer E195-E2, pointed, or you wait for Boeing to maybe certify an aircraft that's already years late.

[00:06:21]Over 55% of the small narrow-body market belongs to the A220. Flat and damning, Boeing's market share in this specific segment lands at effectively zero because the company hasn't produced a purpose-built aircraft in the 100 to 150 seat category since the Boeing 117 ended production nearly two decades ago.

[00:06:45]When AirAsia decided to expand its fleet with a smaller, more efficient narrow-body, pointed, Boeing wasn't beaten in a head-to-head competition.

[00:06:54]Boeing wasn't on the field at all. The company forfeited this entire segment of the market years ago. And the painful part is that the aircraft AirAsia chose, the A220, used to belong to a company Boeing tried to destroy.

[00:07:10]That's where the humiliation really starts.

[00:07:13]Let's go back to 2017.

[00:07:16]Bombardier, a Canadian company headquartered in Montreal, had spent years and billions of dollars developing a clean-sheet narrow-body jet called the C Series, the predecessor to today's A220, designed in Canada and built in Quebec.

[00:07:32]Admiring tone, the airplane was beautiful with a composite wing, modern Pratt & Whitney geared turbofan engines, carbon-fiber reinforced polymer construction and aluminum-lithium fuselage panels delivering about 25% better fuel efficiency than the previous generation of narrow-body jets it was designed to replace.

[00:07:53]Shifting, somber. The problem was that Bombardier was bleeding money. Building, development costs had spiraled and by 2009, when the first wing was assembled, the price tag had climbed to roughly 3.5 billion US dollars. Steady, Quebec stepped in with a 1 billion US dollar investment to keep the program alive.

[00:08:16]Ties, a problem that the world had been dealing with for decades.

[00:08:21]Deliberate, ominous. Boeing saw it differently.

[00:08:25]On April 27th, 2017, Bombardier filed a dumping petition with the US Department of Commerce alleging that Bombardier had sold the C100 to Delta at 19.6 million US dollars per aircraft, well below the production cost of 32.3 million US dollars. The complaint claimed Canadian government subsidies were propping up these low prices and that this represented a threat to American industry.

[00:08:55]Escalating, the US Department of Commerce agreed. Building, by September 26th, the agency alleged subsidies of 220% and on October 6th, an additional 80% preliminary anti- dumping duty was layered on top of that, emphatic, bringing the total proposed duty to 300%.

[00:09:17]Steady, the final ruling on December 20th, 2017, set the duty at 292%, slightly sarcastic, which the Commerce Department hailed as an affirmation of the America First policy.

[00:09:32]Grim, a 292% tariff on every C Series sold into the American market would have killed the program outright. Flat and heavy, Bombardier was looking at financial collapse.

[00:09:46]Turning point, dramatic. What nobody expected was the move Bombardier made in October 2017 when the company handed a 50.01% controlling stake in the entire C-Series program to Airbus, Bombardier's biggest competitor, Boeing's biggest rival.

[00:10:06]Slow, deliberate. Airbus paid that controlling stake to one Canadian dollar. Clipped, symbolic, a token.

[00:10:14]Airbus paid no money, incurred no debt, and assumed no liability for its share in the program.

[00:10:22]Twist of the knife, three months later on January 26th, 2018, the US International Trade Commission, four commissioners, voted unanimously to overturn the duties, finding that the US industry was not threatened. Punchy, Boeing's case was dismissed. Steady, on March 22nd, 2018, Boeing declined to appeal.

[00:10:45]Somber, definitive. By then, it was too late. Staccato, final. The deal was done. Steady, Airbus took formal control on July 10th, 2018, and the C-Series was rebranded Airbus A220.

[00:11:02]Closing the chapter. By February of 2020, Bombardier sold its remaining stake and exited commercial aviation entirely.

[00:11:11]Reflective, asking the audience to sit with it. Think about what just happened from Boeing's perspective. Walking through it. The company filed a trade complaint to crush a Canadian competitor. The complaint got overturned, but during those few months when the tariffs looked real, Bombardier panicked and gave the program to Airbus for $1.

[00:11:33]Emphatic, almost angry on behalf of Boeing, Airbus handed its biggest competitor Airbus a Boeing doesn't have a competing aircraft. Boeing doesn't have a planned aircraft. The 737 design Boeing is still flying traces its roots back to the 1960s.

[00:11:52]Let's talk about the political dimension here because this isn't just an aerospace story. It's also a Canadian foreign policy story.

[00:12:00]Canada has a new Prime Minister, Mark Carney, the former central banker, and Carney has staked his foreign policy on one big idea, which is that Canada needs to stop being so dependent on the United States. He said it publicly. He stated it at Davos on January 20th. The premise is that Canada is no longer just managing a difficult moment with Washington. The country is facing a deeper rupture, and Canada needs to diversify its trading relationships.

[00:12:26]Carney has set ambitious targets, aiming to double Canada's non-US trade within a decade, and pursuing $500 across Asia at a pace that surprised plenty of observers.

[00:12:40]October of 2025 was when Carney went to Kuala Lumpur, Malaysia for the ASEAN Summit, and he met with Tony Fernandes there. According to Fernandes himself, that meeting was where the seed for this AirAsia deal was planted. Quote, "I think Mark Carney is great for our brand. He's very popular in Asia. He's been a great ambassador for Canada." End quote.

[00:13:02]Fernandes also offered something that should sting Americans listening. Quote, "Canada's always played second fiddle in many ways to the United States, right?"

[00:13:11]End quote.

[00:13:12]He went on to say that Carney has changed that dynamic, that Carney has spoken bravely and wisely, and that Fernandes wanted to support him.

[00:13:21]In his speech at the signing, Carney didn't tiptoe around it, framing the deal as proof of the benefits of diversifying trade beyond the United States. Quote, "We shared a vision of deepening ties between those countries that in this crisis that we're still living through are choosing to build in the face of adversity. Countries that have the confidence to open up, to link their economies, to invest in their workers, to move forward, not turn back." End quote.

[00:13:49]Here's where it gets interesting for an American audience.

[00:13:52]Carefully, factually, the United States on May 1st, 2025 opened a Section 237 national security investigation into commercial aircraft and jet engines, and on July 1st, 2025 opened a separate investigation into unmanned aircraft systems. These investigations could lead to new tariffs, and right now the United States is the destination for 63% of Canada's aerospace exports.

[00:14:19]Carney is doing the math. If the US is going to put tariffs on Canadian aerospace, Canada needs other markets, and the Indo-Pacific region is already Canada's second largest trading partner with over $260 billion in two-way merchandise trade in 2025.

[00:14:36]Canada's bilateral trade with Malaysia alone grew nearly 20% in 2025. The Air Asia deal isn't just an airplane order, it's a public demonstration that the strategy is working.

[00:14:49]Plenty of Americans don't realize how big Canada's aerospace industry actually is. So, let me walk you through some numbers.

[00:14:56]Canada's aerospace industry contributed $34.2 billion to Canadian GDP in 2024, supporting 225,000 jobs. And the sector poured $1.2 billion in research and development that year alone, making it Canada's top R&D spender among all manufacturing industries.

[00:15:17]R&D intensity in aerospace runs 2.8 times higher than the broader manufacturing average. Nearly $26 billion in aerospace products got exported in 2024, reaching 166 countries, and more than 70% of Canadian aerospace manufacturing revenue is export-related. Canada ranks in the global top five in civil flight simulators, civil engines, and civil aircraft segments.

[00:15:45]The average Canadian aerospace manufacturing employee earns over $85,000 per year, which lands about 25% above the broader Canadian manufacturing average.

[00:15:56]Zooming in on the Mirabel facility itself, where these Air Asia jets will be built, now employs roughly 5,000 workers, with about 2,500 of those workers hired in the past 4 years.

[00:16:09]Airbus operates 10 sites across Canada and employs more than 5,300 people in the country. Mirabel is described as Airbus's most comprehensive commercial aircraft manufacturing site outside Europe, and Canada is the only country outside of Europe that hosts a major Airbus program.

[00:16:28]That's not nothing. That's a serious aerospace ecosystem.

[00:16:32]I want to be fair here, because not everyone is celebrating, and there are real skeptics whose concerns deserve airtime. John Gradek, who teaches aviation management at McGill University, was direct about it. Quote, "Mr. Fernandez over at Air Asia must have got a heck of a deal, nowhere near the manufacturer suggested retail price." End quote. On the production question, he added, quote, "The jury is still out as to whether the Canadian product that Carney's so gushing about is able to be produced at a rate that is profitable for the manufacturers." End quote.

[00:17:05]He has a point. The Mirabel facility has been struggling to produce more than seven jets per month on average, which lands at about half the threshold needed to break even.

[00:17:15]Airbus has pointed to a range of supplier problems, with shortages running the gamut from wings to Pratt & Whitney engines. And Airbus Canada CEO Guillaume Shevasson told reporters at the announcement that the program remained, in his words, "a few miles away from profitability."

[00:17:31]Eight years after Airbus took over from Bombardier, the program is still not profitable.

[00:17:37]Quebec, which now owns 25% of Airbus Canada, has written off its initial $1 billion US dollar investment in the C-Series as valueless. And the province reduced the estimated value of a subsequent cash injection by half last fall, pegging it at $300 million.

[00:17:55]That's billions in public money that hasn't paid off yet.

[00:17:59]There's also the issue with AirAsia itself. The airline has had a rough financial period, hit hard during the pandemic and forced to restructure. And their 2024 numbers showed an operating loss. The 150 aircraft order is contingent on the airline executing its growth strategy successfully.

[00:18:17]This is genuinely good news for Quebec, for Canadian workers, and for the A220 program. But it doesn't erase the hard reality that this aircraft program has been a money pit for over a decade. The path to profitability still runs through fixing the supply chain, ramping up production, and continuing to win orders at this scale.

[00:18:38]Let's bring it together. Boeing filed a trade complaint in 2017 to kill a Canadian competitor. The complaint backfired. Bombardier panicked and sold control of its aircraft program to Airbus for one Canadian dollar. The American Trade Commission then unanimously overturned Boeing's complaint a few months later, but the damage was already done.

[00:19:00]Eight years later, that same airplane, now called the Airbus A220, just generated the largest commercial aircraft order in Canadian history. 150 jets, $19 billion at list price, built in Quebec, sold to Asia. Boeing wasn't in the running because Boeing has no aircraft in this segment. The 737 Max 7 isn't certified. The Max 10 is delayed.

[00:19:26]The Embraer acquisition collapsed in 2020. Boeing's narrow-body share keeps slipping while Airbus's keeps growing.

[00:19:34]Meanwhile, a new Canadian Prime Minister with a deliberate strategy of trade diversification is using this deal as the public face of his Asia pivot.

[00:19:43]Pointed, knowing. The signing happened the same week the United States is mulling new aerospace tariffs against its closest neighbor. Tony Fernandes himself flew halfway around the world to sign the deal in person, to put on a Montreal Canadiens jersey on stage, and to tell reporters that Canada has played second fiddle to the United States for too long. That's not a normal aircraft order. That's a statement. I can be fair. Boeing may eventually certify the Max 7. The company may eventually launch a true small narrow-body. And the company may eventually rebuild its reputation. The trade complaint Boeing filed 9 years ago is still echoing though. And every time Airbus announces a major A220 order, every time another airline signs up for an aircraft that should have been Canadian, every time Boeing watches a market it can't compete in get bigger, that 2017 decision looks worse. Boeing tried to crush a Canadian aircraft program with tariffs. The tariffs got overturned. The program got handed to Airbus for $1. On May 6th, 2026, in a hangar in Quebec, that exact program just generated a $19 billion order from one of the biggest airlines in Asia with options for 150 more.

[00:21:02]You can call it karma. You can call it a strategic blunder. You can call it the slow grinding consequence of decisions made under pressure. Whatever you call it, Boeing is the one who has to live with it. And so far, Boeing doesn't have an answer.

[00:21:17]That's the story.