Airbus: Trade at risk as subsidy battle rages on

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The chief executive officer of Airbus has warned that trade is at risk, as the US plans tariffs as part of the aircraft manufacturer subsidiary battle.

On 2 October, the World Trade Organization (WTO) gave the USA the go-ahead to impose tariffs of £6.1 billion on imports from the European Union.

The tariffs will affect various goods including aircraft from 18 October, and come as part of the 15 year legal battle over European loans to Airbus.

The loans to develop the Airbus A380 and A350XWB were deemed to be illegal state subsidiaries, and had caused five lost sales and impedance in six different geographic markets.

Saying that Airbus will continue to work with US partners, customers and suppliers, Guillaume Faury warns that tariffs are a barrier to free trade, and would not only affect US airlines but jobs, suppliers and travellers.

He says: “Airbus is therefore hopeful that the US and the EU will agree to find a negotiated solution before creating serious damage to the aviation industry as well as to trade relations and the global economy.”

The WTO will determine the countermeasures the EU can impose on US products including Boeing aircraft in the coming months, in the counter case against Boeing.

It has already been found that the US failed to address illegal subsidies affecting Airbus, and the European aircraft manufacturer says this will provide the EU with grounds to claim countermeasures against the US.

Airbus warns that tariffs on both sides will hurt the EU and US, putting high costs on the acquisition of new aircraft for European and American airlines.

The European manufacturer says the US and EU must find a settlement to the dispute, preserving free, fair competition and open trade to benefit the public.