Airbus seeks to settle Airbus-Boeing dispute outside WTO

Airbus on Monday called for talks between the US and the EU to end the trans-Atlantic fight over subsidies to aircraft manufacturers, even as the World Trade Organisation is expected to give its ruling on the dispute tomorrow.

Airbus said it was the only way to settle the costly six-year-old dispute even as its US rival Boeing said settlement in the case was not acceptable.

WTO is about to publish its ruling on Wednesday on a complaint by Washington that Airbus had received billions to develop aircraft, including the flagship A380 superjumbo, from European governments in illegal loans.

Meanwhile, the publication of the WTO's findings in the US case against Airbus's European backers has come just ahead of a judgment in a counter case against the US and Boeing by Europe.

According to industry watchers, Airbus would not be able to afford to pay back the billions it owes in outstanding loans to Germany, France, the UK and Spain, with the A380 super jumbo not yet having scaled up to commercial production rates and years away from breaking even. Additionally, funding for the over-budget A400 M military transport plane is also not yet in place.
 
Boeing's position, too, is no better, say aviation experts, as it is facing difficulty in getting the new 787 up to full production, given a plane using such huge amounts of carbon-composite materials has not been produced on such a scale before.

Both parties to the dispute have invoked WTO rules barring state subsidies in their battle to establish a dominance in the market for civil aircraft, which has been estimated by plane makers to be worth $3 trillion over the next two decades.