We’re not the only ones questioning the effect of the recent WTO ruling against Airbus and its illegal subsidies.
A respected business writer from The Seattle Times has weighed in with this opinion piece.
We’ve long been cynical of the WTO and the Airbus/Boeing complaints as little more than political talking points. We’ve noted before the ineffectual rulings that Canada and Brazil illegally subsidized the Bombardier CRJ and Embraer EMB-jets, and nobody imposed sanctions.
Boeing was found many times to have improperly benefited from tax breaks via the Foreign Sales Corp. (FSC, pronounced “fisk) legislation. The European Union went back to the WTO six or seven times for enforcement once the FSC was found to be illegal (with application to 767, by the way), and nothing happened.
We’ve noted time and again that no sanctions are likely to ever be applied to Airbus and Boeing airplanes. If any sanctions at all are applied, they will be to unrelated products in unrelated industries, such as French wines and Washington State products–industries and products that have nothing to do with aerospace. Aerospace is too important to both sides to tamper with. Should the US sanction Airbus on, say, the tanker or commercial sales to, for example, United Airlines, then the EU will retaliate in kind for Boeing sales to European defense and airliner products.
The whole thing is a ridiculous sham.
This toothless organization is nothing but a waste of time, money and effort.
Separately, this news article reports EADS cut the price of the tanker by 10%. This isn’t the least bit surprising; the withdrawal of Northrop Grumman from the competition eliminated NG’s estimated 10%-15% mark-up.
Boeing also cut the price of its bid compared with two years ago, which also is not surprising. As we reported here, the shift to a Lean production line and Jim Albaugh’s more price-aggressive approach meant that Boeing would lower the price.
Say whatever you will about EADS, ain’t competition grand?