Airbus said European governments have promised almost 1. 5 billion euros ($1.8 billion) in loans to help develop a fuel-efficient jetliner...

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Airbus said European governments have promised almost 1.5 billion euros ($1.8 billion) in loans to help develop a fuel-efficient jetliner to compete with Boeing’s new 787 model.

Airbus Chief Executive Officer Gustav Humbert said he has aid commitments from the governments of France, Germany, Spain and the U.K. for the new A350. Humbert said Airbus could build the plane without the loans, yet wanted the money because Boeing is getting government aid for the 787.

“We need the money to have an equal playing field,” Humbert said at Airbus’ Toulouse, France, headquarters. “As long as the 787 is supported,” Airbus should take advantage of government loans permitted under a 1992 agreement between the U.S. and the European Union, he said.

Airbus’ acceptance of the loans may exacerbate a trade dispute between the European Union and U.S. over government help for plane makers. The U.S. filed a complaint against European aid with the World Trade Organization and terminated the 1992 trade agreement with the European Union that allowed government aid last year. The European Union filed a countersuit against the U.S., and the dispute is being weighed at the WTO in Geneva.

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The U.S. complaint argued that Airbus has received more than $15 billion in government loans since 1967, helping it overtake Boeing’s lead in aircraft sales. The EU complaint argued that Boeing got $23 billion in aid since 1992 through indirect government help.

Airbus expects its parent companies — European Aeronautic, Defense & Space and BAE Systems — to approve the balance of funds needed for development and construction of the plane in early October, Humbert said. The total development cost will be 4.35 billion euros and the governments would cover a third.

Wiring forced halt

on A380 production

Airbus had to shut the A380 model’s assembly line from May until August to work out how to configure wiring and electronics in the plane cabin, Chief Operating Officer Charles Champion said.

Airbus needed to determine specifications and locations for wires and electronics for systems such as lighting and in-flight entertainment, said Champion, who is also director of the A380 program. The plane will be the world’s largest airliner, seating 550 people in a standard three-class configuration.

Singapore Airlines, the A380’s first customer, is now scheduled to receive the first plane at the end of 2006. All other deliveries will be delayed by six months until Airbus can catch up on production, Champion said. No date for doing that has been set.

Bloomberg News