Due to expansive tariffs levied by the Donald Trump administration, Swiss aircraft manufacturer Pilatus is temporarily halting deliveries of its business jets to U.S. customers.
On Friday, the company announced it would stop all deliveries of its PC-12 and PC-24 jets, one day after Switzerland was hit with a 39 percent tariff on exports to the U.S., one of the highest rates imposed since Trump began upending the international trade market upon his return to office.
The 39 percent tariff rate for Switzerland is the fourth-highest rate imposed by the U.S.— behind only Laos, Myanmar and Syria, which are stuck at rates between 40 and 41 percent, according to PBS.
The steep rate was first announced on July 31 when Switzerland failed to reach a trade deal with the U.S., setting off a one-week negotiating dash to prevent the tariffs from taking effect on August 7.
Switzerland President Karin Keller-Sutter, who also serves as the country’s finance minister, led a hastily-devised delegation to Washington, D.C., last week as a last-ditch effort to stave off the impending tariffs.
Because of the hurried nature of the trip, the delegation did not end up meeting with Trump, instead speaking with Secretary of State Marco Rubio and other trade representatives within the administration. Ultimately, the delegation didn’t produce any meaningful results in the short term, leaving Keller-Sutter and her country empty-handed.
For Pilatus, the new tariff rate is consequential. The U.S. makes up around 40 percent of the company’s annual production of the PC-12 and PC-24. According to Reuters, Pilatus is considering a number of cost-cutting measures like short-time working adjustments for employees and allocating the PC-12 and PC-24 to other markets while the 39 percent tariff rate remains in place.
“The new customs tariff imposed by the U.S. authorities represents a significant competitive disadvantage for Pilatus,” the company said.
To avoid the crippling tariff, Pilatus also said it is ramping up efforts to expand U.S. production, including the launch of its proposed facility at Sarasota Bradenton International Airport (KSRQ) in Florida.
Announced last year, the business jet manufacturer signed an agreement with the Sarasota Manatee Airport Authority to develop 54,000-square-foot space for maintenance, spare parts, and new aircraft deliveries, with an additional 17,000 square feet going to workshop, office, and administrative space. Previously, Pilatus hoped to have the facility operational some time in 2026.
This follows similar moves by French aircraft manufacturers, Aura Aero and Elixir Aircraft, which have both recently announced plans to develop production centers in Florida to support U.S.-based deliveries of their training aircraft.
While Aura Aero and Elixir’s plans were not explicitly stated to be for the purpose of avoiding tariffs like Pilatus, the moves are a part of a growing trend where overseas manufacturers are racing to open U.S. productions wings. Taiwan-based AeroJones recently launched AeroJones Aviation USA in Zephyrhills, Florida, to carry out production of its AJ Sport aircraft.
Economists in Switzerland are also warning of job cuts as a result of the tariffs due to what Pilatus called “massive additional costs and the resulting competitive disadvantages.”
