Airbus has released a statement commenting on the upcoming World Trade Organisation (WTO) ruling on subsidies paid to Boeing by the US government.
The EU and US have been fighting over passenger aircraft subsidy levels in the WTO for the past six years.
“World Trade Organisation (WTO) decision confirms that Boeing has received massive and illegal government subsidies for many decades, and that they have had a significant and ongoing negative effect on European industry.
“The final WTO-report to be publicly released in a few weeks can be expected to say:
“1. Boeing would not have been able to launch the 787 without illegal subsidies.
“2. Boeing has received at least US$5 billion of US taxpayer dollars which has been determined illegal.
“Quantification of the additional subsidies beyond this figure will take place in later stages of this dispute if Boeing chooses to pursue it.
“3. An additional more than US$2 billion in state and local subsidies that Boeing will receive in the future are illegal.
“4. The effect of the subsidies is significantly larger than the face value of the subsidies in light of their particularly pervasive nature.
“5. The pervasive subsidies have thoroughly distorted competition within the aviation industry, directly resulting in significant harm to the European aerospace industry.
“6. The effect of these subsidies will continue in the future, putting Airbus at a significant disadvantage.
“In concluding that Department of Defense (DoD) and NASA funding are illegal subsidies, the WTO decision will require fundamental changes to the US funding mechanisms.”
Boeing was quick to reply with the following statement: “Reports confirm the interim news from last September that the WTO rejected almost all of “Europe’s claims against the United States, including the vast majority of its R&D claims - except for some US$2.6 billion.
This represents a sweeping rejection of the EU’s claims.
“Nothing in [the] reports even begins to compare to the US$20 billion in illegal subsidies that the WTO found last June [2010] that Airbus/EADS has received (comprised of US$15 billion in launch aid, US$2.2 billion in equity infusions, US$1.7 billion in infrastructure, and roughly US$1.5 billion in R&D support).”
Both companies have disagreed over the level of subsidies provided to each of them by their respective governments and a resolution does not appear to be in sight at this stage.
US lawmakers are unsure as to what affect the WTO decision and ongoing court case will have on the US Air Force’s refuelling tanker competition between the two companies.
A decision on the hotly contested multi-billion dollar project is imminent.