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Airbus: Wash., Everett need to stop subsidizing Boeing

Published 10:38 am Monday, January 31, 2011

By Michelle Dunlop Herald Writer

European jet maker Airbus called out the city of Everett and Washington state for giving illegal subsidies to the Boeing Co. following a trade ruling Monday.

The World Trade Organization issued a final report on claims mad

e by the European Union on behalf of Airbus against the United States and Boeing.

Although the WTO report won’t be made public for a few weeks, the EU and Airbus claimed victory.

A couple key points from Airbus’ take on the WTO ruling:

  • Boeing would not have been able to launch the 787 without illegal subsidies.

  • Boeing has received at least $5 billion of US taxpayer dollars which has been determined illegal.

  • An additional more than $2 billion in state and local subsidies that Boeing will receive in the future are illegal.

  • The effect of the subsidies is significantly larger than the face value of the subsidies in light of their particularly pervasive nature.

  • The WTO decision will also confirm that Washington State and the City of Everett must stop subsidising Boeing.

Boeing has a different understanding of the WTO ruling (from company statement):

“Today’s reports confirm the interim news from last September that the WTO rejected almost all of Europe’s claims against the United States, including the vast majority of its R&D claims – except for some $2.6 billion. This represents a sweeping rejection of the EU’s claims.

In 2004, Boeing lodged a complaint with the WTO over illegal subsidies given to Airbus by the EU. The WTO’s ruling on that case also had both sides claiming victory.

Here’s what Boeing had to say about that:

“Nothing in today’s reports even begins to compare to the $20 billion in illegal subsidies that the WTO found last June that Airbus/EADS has received (comprised of $15 billion in launch aid, $2.2 billion in equity infusions, $1.7 billion in infrastructure, and roughly $1.5 billion in R&D support).”

As a result of the June WTO ruling, EU governments and Airbus/EADS must repay or restructure $4 billion in still outstanding illegal launch aid subsidies Airbus received to develop the A380. They must also remedy the adverse effects of the additional $16 billion in other illegal subsidies Airbus received.”

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