White House to File Case Over Airbus

[muriel_volestrangler]

The Bush administration said Monday it would bring a trade case alleging the European Union is providing illegal subsidies to Airbus, the major competitor to U.S.-based Boeing Co.

U.S. Trade Representative Rob Portman said the administration had decided to proceed with a case before the World Trade Organization in light of preparations by member states of the European Union to commit $1.7 billion in new launch aid to Airbus.

``The EU's insistence on moving forward with new launch aid is forcing our hand,'' Portman said in a statement announcing the administration's decision.

Both sides argue that the other is providing WTO-illegal subsidies to support a domestic airplane manufacturing industry.

http://www.guardian.co.uk/worldlatest/story/0,1280,-5041555,00.html?gusrc=ticker-103704

[Fridays Child]

1. It pisses George off when he finds out that the world can do business...

...without his imperial highness' permission. I hope Boeing workers and employees of all of the industries that depend on Boeing can see what George has done to our reputation abroad.

[Sokrates]

2. This has nothing to do with Bush.

I hope Boeing workers and employees of all of the industries that depend on Boeing can see what George has done to our reputation abroad.

This has been going on since the 80's. I'd imagine that the Boeing workers are cheering this development. Essentially France and to some extent England heavily subsidize Airbus in direct violation of their GATT/WTO agreements. In addition they refuse to use American engines, again in violation of the treaties.

This will be a an interesting case for the WTO.

[Kellanved]

4. nope, as always there are two sides to the story.

The EADS subventions are WTO conformant loans; the American GE engines are very common with Airbus planes. The current problem is that the GE/Honeywell merger was breaching EU antitrust laws.


Read this, the truth is probably in between:

--snip
Following the appointment of a new USTR just a few weeks ago, Airbus and its shareholders, EADS and BAE Systems, have put strong hopes on a new start for the peaceful settlement of the EU-US trade dispute on aeronautics. They are strongly convinced that the opening of a litigation would amount to the launch of a trade war which is in the interest of none of the stakeholders except, in a short term view, those looking for being protected from fair competition including on their domestic market.

However, several statements made by authorized persons in the USA along the last few days have cast a serious doubt on the interest of the US for a negotiated outcome. For the avoidance of doubt, Airbus and its shareholders hereby confirm their full support to the European Commission and its target of a balanced and extended withdrawal of all kind of supports whether they come from national or local authorities, including those provided by third parties, like, for instance, Japan.

Such a negotiation should also address the short-term issue of the two competing new aircraft, the Airbus A350 and the Boeing 787. This latter has become the world’s most subsidised airliner ever. Boeing has amassed more than US$5 billion in government subsidies to pay for its development and production, through US and foreign government R&D funds, tax relief schemes and launch aid. New subsidies are being added every day. But for these subsidies, Boeing could not have launched the 787, which is currently being dumped on the market at unprecedented low prices.

Many of the technologies on the 777 and 787 were paid for by government. The composite wing was a NASA programme; the composite fuselage comes from military programmes developed by Boeing including the B2 and the V22 Osprey. Between 1992 and 2004, Boeing has benefited of more than US$12 billion from NASA research funding. It has also received US$1.5 billion from FSC, an illegal export tax scheme. It has not repaid even one cent to the US government or taxpayer.

...
http://www.luchtzak.be/article8817.html

[Placebo]

3. Airbus uses really dirty business tactics...

One of the most recent cases in point:

Airbus Threatens UK Government

European aircraft manufacturer Airbus has told the government that unless it receives up to £400 million in aid to launch its new €4 billion mid-range plane, Britain could lose the job of building its wings.

"Airbus UK head Iain Gray has told the Department of Trade and Industry that it is vital to the skills and technology base of the UK aerospace industry that Airbus plants at Filton, near Bristol, and Broughton, near Chester, are chosen to design and build the wings for the new A350. Airbus is hoping to announce 100 orders for the plane at the Paris airshow next month."

http://observer.guardian.co.uk/business/story/0,,1494548,00.html

It doesn't end there, either. Airbus apparently wants not only the British contribution, but also further 'donations' from the rest of Europe, by the Paris Air Show on June 13th.

"Airbus wants the governments of Britain, France, Germany and Spain to sign up for the A350 by the start of the Paris air show on June 13, when the planemaker plans to announce 100 orders for the aircraft, including a blockbuster contract for 50 from Emirates, the fast-growing Gulf carrier."

http://www.timesonline.co.uk/article/0,,2095-1631948,00.html