Airbus defends A350 state financing

French Prime Minister Francois Fillon, second left, listens to the head of European aerospace giant EADS, Louis Gallois, left, and Airbus CEO Tom Enders, third from the left, Monday June 15, 2009.

Tools

Story Published: Jun 16, 2009 at 9:18 AM MST

Story Updated: Jun 16, 2009 at 10:37 AM MST

By Associated Press

LE BOURGET, France (AP) — Airbus CEO Tom Enders defended government financing for the €11 billion ($15.24 billion) A350 XWB program on Tuesday, claiming the European planemaker is seeking a "level playing field" with competitor Boeing Co.

Boeing called the European government funding for the project unfair.

A funding row over the A350 XWB, designed to compete with Boeing's hot-selling 787, could re-ignite an old trade dispute over alleged large commercial aircraft subsidies awaiting a ruling by the World Trade Organization. The U.S. and EU both accuse each other of providing billions in illegal subsidies to the companies.

In a news conference at the Paris Air Show, Enders confirmed the development costs of the program would be "around €11 billion," of which 30 percent to 33 percent could be financed by reimbursable loans from European governments.

He said Airbus needs the financing to "level the playing field with our competitor."

The United States says EU subsidies have enabled Airbus to capture long-standing Boeing customers. The EU counters that Boeing receives U.S. federal and state tax breaks, development funding and grants, as well as a large amount of military contracts.

The four European countries that produce Airbus jets failed to agree financing at a meeting on Monday because the fourth nation — Spain — did not show up.

Enders tried to squash suggestions that this was due to a problem with Spain, saying: "From Airbus' point of view I do not see any conflict with the Spanish government."

French Transport Minister Dominique Bussereau said a decision should be reached within a month.

"What makes this disappointing is that the Airbus countries, the Airbus trade ministers, are very much aware that the WTO is about to make this ruling. It really does seem to show some disregard for the process," said Theodore Austell, Boeing's vice president for government operations.

"Airbus, EADS as an enterprise has indicated on more than one occasion that they have sufficient funds within their own coffers to fund future programs," he said, calling Airbus plans to seek government financing "pretty remarkable."

Current Weather

Icon
Current Temp 28.0 °F
Fair
Video
More Weather

Upload directly from your mobile device.

Learn how

YouNews

This content requires the latest Adobe Flash Player and a browser with JavaScript enabled. Click here for a free download of the latest Adobe Flash Player.

On Demand

Resources and info you need to prepare for the switch to DTV.

Stay Connected

Viewer Poll

Since state law requires a balanced state budget, Gov. Otter is concerned that falling tax revenue might force the state to make much deeper cuts than currently planned. What do you think about the Idaho law requiring a balanced budget?

  • It seemed like a good idea at the time, but these are unusual times. How much more can we cut out of education, etc.? We need to revisit the balanced budget law.
  • If more education funding and state services need to be cut, so be it. Sometimes it's painful to live within a budget, but it's the right thing to do.
  • Not sure.

Connect with KIDK