Boeing's 2005 Success May Hurt In Subsidies Battle
Throwing Jet-A on the contentious, long-smoldering battle over
trade subsidies, an Airbus exec stated last week the 1,002 orders
Boeing booked in 2005 show the American manufacturer has no trouble
competing in the marketplace with its European rival, government
subsidies or no.
"Part of the Boeing case is to show damages from unfair
competition in the marketplace," said Allan McArtor, chairman of
Airbus North America Holdings. "It would appear that it will be
difficult for Boeing to show damages in the marketplace."
McArtor's comments, while undeniably self-serving, may gain
foothold within the World Trade Organization, where the two
aerospace manufacturers are duking it out over the billions of
dollars Airbus receives in subsidies from its partner governments
-- which give the European consortium an unfair advantage,
according to Boeing.
Some experts say Boeing can't have it both ways, however.
"You can't have record sales and say these subsidies are
damaging us," said David Pritchard, an expert on aviation trade, to
the Chicago Tribune.
Boeing maintains subsidies are a long-standing issue, and its
recent success does not diminish their negative impact on the
American manufacturer. Boeing cites its reduced market share in the
last five years -- from 67 percent, to just around 50 percent --
and its need to lay off as many as 400,000 employees in an effort
to match costs with Airbus.
"We remain as committed as before to ending the Airbus
subsidies," said Christin Baker, spokeswoman for the US trade
representative's office. "The facts remain the same. One year
doesn't change the fact that there has been substantial
Airbus has yet to report its 2005 numbers, but it is unlikely to
match Boeing's record year -- and while the European consortium
still built more aircraft last year than its American counterpart,
that lead may dwindle as well over the next several years.
Should that happen, Boeing may well win the battle... but lose
the war, a victim of its own success -- and any number of other
obvious cliches. Stay tuned, this could get interesting...