Airbus/Boeing/subsidies/trade law

[Eubulides <paraconsistent@xxxxxxxxxxx>]

Thursday, December 11, 2003
Airbus on lookout for undue Japanese government aid for 7E7
THE ASSOCIATED PRESS

PARIS -- European aircraft maker Airbus said yesterday that it has been
gathering information on public aid to three Boeing Co. subcontractors to
check whether the company's deals with the Japanese manufacturers breach a
key trade agreement.

Airbus is particularly concerned about pledges of Japanese government
support for Boeing's planned new fuel-efficient passenger jet, the 7E7
Dreamliner.

"We're following very closely what's happening with the 7E7 and forwarding
the information we are gathering to the EU authorities," Airbus spokesman
David Voskuhl said.

He was speaking after the French daily Le Figaro quoted Airbus Chief
Executive Noel Forgeard yesterday voicing concern over Boeing funding.

"We want European Union countries to know what's going on," Forgeard was
quoted as saying.

Under the terms of a 1992 bilateral accord on civil aviation, the United
States and the European Union pledged that government loans would not be
allowed to exceed 33 percent of total investment by their respective
aerospace companies.

Since then, however, each side have repeatedly accused the other of
breaking the deal.

Airbus is concerned about government loans and subsidies promised to the
Japanese companies lined up for about one-third of the manufacturing work
for the 7E7.

These include Japanese engineering firms Mitsubishi, Kawasaki and Fuji.

The Dreamliner is due to take to the skies in 2008, if it gets the final
go-ahead from Boeing's board.

Boeing spokesman Todd Blecher said he found it ironic that Airbus was
raising concerns about potential support for the 7E7, given "the billions
of dollars in subsidies Airbus has received for more than 30 years."

"It's premature for anyone anywhere to speculate on the specific funding
mechanism our partners might use for the 7E7," Blecher said.