Canada is scrapping a plan to buy 18 Boeing Co (NYSE:BA) Super Hornet fighter jets amid a deepening dispute with the U.S. aerospace company, three sources familiar with the matter said on Tuesday.
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Instead, the Liberal government will announce next week it intends to buy a used fleet of older Australia F-18 jets, the same kind of plane Canada currently operates, said the sources, who asked not to be identified because of the sensitivity of the situation.
The Liberals - who said in late 2016 they wanted the Boeing jets as a stopgap measure - froze talks on the proposed deal this year after Boeing launched a trade challenge against Canadian planemaker Bombardier Inc.
As relations between the two sides deteriorated, Ottawa slammed Boeing for not acting as a trusted partner and began looking at the Australian jets.
Two of the sources said Australian military officials had been in Ottawa late last month for talks.
The offices of Public Works Minister Carla Qualtrough and Defence Minister Harjit Sajjan, who share responsibility for military procurement in Canada, both declined to comment. Boeing was not immediately available for comment.