Says Airbus Vastly Overestimating Amount Of Aid Received

Boeing is preparing its defense against a charge from the European Union that the company has benefitted unfairly from more than $10 billion in US government subsidies. The charge is pending before the World Trade Organization, and the US has filed a similar, but much larger complaint about EU subsidies of Airbus.

Thompson Financial quotes one advisor to Boeing saying the EU is vastly overestimating what the US government has paid Boeing over the past 30 years. The EU claims at least $10.4 billion. Boeing argues that it has received only about $750 million over that period.

Boeing and the Bush Administration argue the payments from the Defense Department are for services rendered, not subsidies, and that technology developed under defense contracts is typically prohibited from export on civilian aircraft.

Another Boeing argument is that Airbus has outsold Boeing in recent years, and has a bigger order backlog... making it hard to demonstrate financial harm, as required under WTO rules.

The US has charged that Airbus gets hundreds of billions of dollars in zero-interest government loans to launch new products, and is not forced to pay them back if the products are unsuccessful.

Both sides have hinted that they're interested in a settlement outside the WTO, to avoid resulting tariffs that are WTO's only available remedy.

FMI: www.airbus.com, www.boeing.com