US pressure on Europe to abandon a 1992 accord allowing government launch aid for commercial airliners is mounting, with senior US trade officials joining Boeing chief executive Harry Stonecipher in calling for an end to subsidies.
Trade representative Robert Zoellick says the US government is urging the Europeans to stop providing launch aid to Airbus. "[Boeing] does not want Europe to add more financing for an alternative to the 7E7 or difficulties with the [Airbus] A380," he says.
The existing bilateral agreement on trade in large civil aircraft, signed by the European Union and USA in 1992, allows direct government support in the form of repayable loans up to a maximum 33% of the development cost.
Stonecipher argues the original justification for the 1992 agreement, to help a start-up industry, no longer applies now that Airbus has overtaken Boeing in market share (Flight International, 13-19 July). Zoellick agrees, saying: "Frankly, if there was ever a justification in 1992 or earlier for a start-up industry, that has long been overcome."
US commerce secretary Don Evans says talks are being held with Boeing, which has promised to take unspecified action this year over alleged unfair Airbus subsidies. "We share their concern. We think they are legitimate concerns," he says.
US senator Patty Murray, representing Washington state, last week urged the Bush administration "to signal our intention to withdraw from the 1992 US-EU bilateral". Stonecipher, however, is anxious to avoid a trade war, making it unlikely Boeing will push the US government to take its case to the Word Trade Organisation.
Trade commissioner Pascal Lamy says the EU would have "no problem" discussing the 1992 accord with USA. Airbus, meanwhile, says it operates in accordance with the agreement "and does not see a reason for anyone to withdraw".
GRAHAM WARWICK / WASHINGTON DC
Source: Flight International
