At a hastily called news conference to celebrate Airbus' win of a 60-plane order for the proposed A350, Chief Executive Noël Forgeard...
PARIS — At a hastily called news conference to celebrate Airbus’ win of a 60-plane order for the proposed A350, Chief Executive Noël Forgeard yesterday said his company can launch the plane without European government aid if necessary.
“Which does not mean that we will spit on any form of support that would be jointly agreed,” Forgeard added.
“We shall do the A350 anyway,” he said, “since we have the orders.”
Forgeard arrived late to join chief salesman John Leahy at the Paris Air Show briefing. Coming straight from a meeting with French President Jacques Chirac, Forgeard bustled in with his trademark wide-eyed, impish grin at the assembled reporters. He listened while Leahy gave a confident assessment of the A350’s prospects.
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“We’re sitting at 90 (A350 orders) right now and it’s only the first day of the show,” said Leahy. “Having 100 by the end of the week is in the bag.”
Leahy’s total counts 20 jets ordered by US Air as a result of Airbus’ investment in the struggling carrier’s planned merger with America West. It also includes 10 jets for Air Europa, which ordered the A350 last year when the plane was still pitched as a derivative of the A330, a cheaper project than the “all-new” jet Leahy now describes.
Leahy said Air Europa would get the upgrade at the original contract price — quite a deal.
Forgeard gave the development cost of the A350 as 4.35 billion euros or $5.3 billion.
He said the delay in formally launching the airplane was due to the complex process of lining up the financing.
Mike Bair, head of Boeing’s 787 program, also addressed the issue of subsidies following a question from a European journalist at a news conference.
He said the $3.2 billion in tax breaks offered by Washington state are not subsidies, because Washington was just adjusting its tax code to be competitive with other U.S. states.
The tax reduction was not going to affect the success of the 787, he asserted; its only impact was on where the plane would be built.
“Washington state did that because they were driving away aerospace business from the state,” Bair said. “If Washington state had not improved their (business tax) position, we would have moved somewhere else.”
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starts at WTO
GENEVA — The United States and European Union yesterday both blocked requests from one another asking the World Trade Organization (WTO) to create panels to investigate illegal subsidies allegedly paid to rival airplane makers Airbus and Boeing, trade officials said.
The moves were largely routine bureaucratic maneuvering — both sides are expected to make second requests for the panels to be set up, at which point the WTO will have to move ahead with its investigation of U.S. subsidies to Boeing and European aid to Airbus.
The WTO’s dispute-settlement body will consider the next round of requests after June 23.
Washington filed a complaint at the WTO last month about plans for European government aid to fund development of Airbus’ A350, a midsize jet to compete with Boeing’s 787 Dreamliner.
“Airbus has used these subsidies to seize more than half of the large civil-aircraft market at the expense of its U.S. competitors,” U.S. Ambassador Linnet Deily told a meeting of the arbitration body yesterday.
The European Union then filed a counter-complaint, claiming that Boeing continues to benefit from massive subsidies in violation of international trade agreements.
“It is in reality U.S. subsidies to Boeing that are distorting the market for large civil aircraft,” said EU Ambassador Carlo Trojan. “America’s decision will spark probably the biggest, most difficult and costly legal dispute in the WTO’s (10-year) history.”
The Associated Press