Skip to comments.WTO rules some EU subsidies to Airbus illegal
Posted on 07/01/2010 2:39:21 AM PDT by ErnstStavroBlofeld
The World Trade Organization on Wednesday faulted the European Union for providing cheap loans to Airbus to help lower its cost for developing new airplanes and take market share from Boeing Co.
It's a clear victory for the Chicago-based manufacturer, providing the company with precedence to disrupt similar funding for the up-and-coming A350XWB, which will compete with its 787 Dreamliner. It could also help the company to score a $35 billion U.S. contract to replace the military's aging aerial-refueling fleet.
"The ruling shows the WTO works and it can understand the aerospace industry," said Teal Group analyst Richard Aboulafia, who praised the group's decision. "It will take a long time for it to filter down to concrete change, but it provides a framework and a strong endorsement of the U.S. view."
Eventually there could be a negotiated settlement, which could be a potential game changer for the global aerospace industry currently dominated by Boeing and Airbus, but which is gaining entrants from Brazil, Canada and China.
In the 1,000-page report the WTO called for immediate end to the subsidies, but Airbus noted the dispute could continue on for a few more years. Eventually the company could be forced to pay back some of that funding.
Up until the end of 2006, the U.S. alleged Airbus received up to $100 billion in member-state financing, though the WTO considered that calculation "fundamentally flawed."
(Excerpt) Read more at marketwatch.com ...
I am waiting for Obama to seize Boeing, now that they are building aircraft in non-union South Carolina.
A far better source:
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.