For Airbus and Boeing, it’s about Alabama, Alabama, Alabama

US Sen. Jeff Sessions (R-Alabama) is President-Elect Donald Trump's choice for US Attorney General. He's a close ally of Airbus. Photo via Google images.

US Sen. Jeff Sessions (R-Alabama) is President-Elect Donald Trump’s choice for US Attorney General. He’s a close ally of Airbus. Photo via Google images.

Nov. 29, 2016, (c) Leeham Co.: When it comes to the prospect of imposing trade sanctions or retaliatory tariffs on Airbus for airplanes ordered by US customers, the European manufacturer has some advantages over Boeing few people apparently have thought about.

Alabama, Alabama, Alabama

One is called Alabama. It’s where Airbus is producing A320 family members for US customers.

Alabamans voted by 1.76-to-1 for Donald Trump. Sixty-three percent to 35%.

Donald Trump tapped Sen. Jeff Sessions of Alabama to be his Attorney General. Sessions was one of the first in Congress to endorse Trump. He served as an advisor throughout the campaign.

Sessions is a big supporter of Airbus.

Sen. Richard Shelby, the other Alabama Senator in Congress, is also a big supporter of Trump. And of Airbus.

It’s highly likely that Sessions and Shelby will bend Trump’s ear in favor of not levying tariffs on Airbus planes.

Ties to Deep Red

During the run-up to the competition between Airbus (EADS) and Boeing in the KC-X tanker competition, EADS, as the Airbus parent was then named, developed deep ties with the Deep South in the US—all “red” territory in US elections colorization. (Red is for Republicans and Blue is for Democrats.)

Airbus Helicopters is a major supplier to US law enforcement and the Department of Defense. Its US headquarters is in a Dallas (TX) suburb, Texas is another Deep Red state.

Boeing’s Blues

In contrast, Boeing’s corporate headquarters is in Chicago (IL)—a Deep Blue state.

It’s Boeing Commercial Airplanes headquarters is in the Seattle suburb of Renton (WA)—another Deep Blue state.

Yes, Boeing Defense is in St. Louis (MO), which went for Trump. But this is unlikely to be enough to sway an argument.

Alabama, again

But the biggest impediment the US Trade Representative and Boeing have in directly penalizing Airbus comes back to Alabama. The Airbus A320 final assembly line

The first Airbus A321 produced in Alabama for American Airlines. No tariffs on US-made A320s. Photo via Google images.

The first Airbus A321 produced in Alabama for American Airlines. No tariffs on US-made A320s. Photo via Google images.

in Mobile was built specifically to deliver airplanes to US customers.

Thus, it’s a US-produced aircraft (much like the Boeing 787 despite structures and wings coming from all over the globe).

Trade tariffs can’t be placed on US-produced airplanes.

LNC doesn’t know how many of the hundreds of A320s destined for US customers over the next six or seven years will come from Mobile. Initially the production rate is ramping up to 48 per year with a capacity of 96 per year. There’s room to grow beyond that.

But clearly, the airplanes produced in Mobile reduce the opportunities for the USTR and Boeing to impose tariffs directly on A320s.

Wide-body A330s and A350s are only produced in Europe, so these are entirely fair game.

As LNC wrote last September, the likelihood of tariffs on Airbus airplanes is remote.

The Alabama connections makes it even more remote.

98 Comments on “For Airbus and Boeing, it’s about Alabama, Alabama, Alabama

  1. Jeff Sessions also lives in Mobile and has so for many years. He is well aware of the struggle during the tanker competition and the questionable final results. Mobile is now very pleased that the tanker went to Boeing as we are much better off in the long term with the Airbus plant producing 320’s and likely later other aircraft. The job factor has not matured yet but we all know that it is coming. I know Jeff and his family; they are good people.

    • The final result were not questionable, Boeing bid far lower meeting all the requirements.

      Quite question is the fact that the US cannot bid on European projects but they can on US ones.

      I don’t see that we got to bid on the A400, Typhoon or Rafael projects. All of them get to participate in the F-35.

      Its taken Australia 5 years to get their A330MRT working fully, and that aircraft does not have the hardened requirements of the KC46 so we have no idea how long it would have taken Airbus to get their bird working to us specifications .

      The N-90 project is still not working and is on the critical list of non performance projects for Australia . Its also had serious issues in European service.

      Their Tiger attack helicopters are also not performing for Australia.

      The Super Puma current model keeps loosing its transmission and killed people in its last crash.

      All that is a warning that what looks good may not be and Alabama benefits should not drive the entire US procurement.

      • The fact that you know Mr. Sessions and his family has no relevance at all.

        Commenting on Mr. Sessions and his worth as well as his family gets into political ground that Scott is not going to appreciate me commenting on and I won’t.

        I will say I vehemently disagree.

        • I’m with you, TransWorld. I strenuously disagree with the statement “Jeff Sessions and his family are good people.”

          And Airbus didn’t get jobbed on the tanker, Jim Green. We’ve been through this many times before.

          • “I’m with you, TransWorld. I strenuously disagree with the statement “Jeff Sessions and his family are good people.”

            Why, do you know them?

            I don’t know if he’s “good” or “bad” and have no ideal about his family…

          • I think we can look at Sessions public record and at best its questionable.

            Just kidding does not cut it with me.

          • So you judge his family by his actions?

            People really need to dial down the hate.

          • You are misquoting me.

            Frankly I could care less about Sessions family. I have no take one way or the other on them. I know they are vastly better off than I am and they are not going to suffer anything.

            Jim brought up his family. What does that have to do with policy? On the other hand, if he wants to bring Sessions family into it, then they become fair criticism by association.

            I do have issues with Sessions, at the most charitable he has a flapping mouth and is a self serving hypocrite, at worst there is a racist streak in there.

            Note that he is involved in giving tax dollars away to another corporation.

            I will note my brother once made a racist comment at a family gathering. He too is flappy and loose when there is no one of color around.

            My nephew called him on it and pinned him. I was never more proud of him (and he has a track record that anyone would be proud of)

          • I can see Jeff Sessions record, statements, and actions, and that speaks volumes enough for me.

            There is no hate when you disagree strongly with their public pronouncements and record. Perhaps you should dial back the “hate” card and realize it isn’t love/hate; it’s an objective view of his views and that doesn’t square with my definition of “good people.”

          • Sorry Trans I should have been more specific.Nor do I care about nailing brothers for “racist” comments. After all criticism of President Obama has been cited as racist so much anymore the term has lost any real meaning. As for Sessions track record…

            http://www.wsj.com/articles/the-racist-smear-against-jeff-sessions-1480465010

            http://www.salon.com/2016/12/01/calling-jeff-sessions-racist-conveniently-ignores-the-work-hes-done-for-alabamas-black-community/

            Regardless, Neutron why would you”strenuously disagree” that his family are not good people? “There is no hate when you disagree strongly with their public pronouncements and record. “. On what record is that based on?

            Sorry but dragging his family into is absolutely hate and is a symptom of how politics has gotten so personal.

      • Australia has problems because they include their own requirements, usually software driven which are ‘made in Australia’- the reality is they are just not up to it in , happened in their subs combat systems, the same with Kaman SH2G.
        The Boeing 737 Wedgetail had massive problems too, so its not just a Airbus thing

        • I agree, but keep in mind Wedgetail is a Turkish and Australian supplied entity that the US does not operate.

          Its not that US equipment is issueless, once its fielded it tends to work very well.

          There has been a trend to US sources and unmodified equipment from what I gather.

          Still European equipment is fragmented, conflicting versions even when they agree on something (Tiger) etc.

        • This is very true, Australia has a habit of attempting to modify proven over the counter items into a bespoke grab bag of capabilities way beyond those originally intended.
          The most successful defense purchase in recent years was the C-17 airlifter which was purchased unmolested in its original form.

        • RAAF always want to one up everybody else, F-111C wing problem was typical of them, the RAAF aircraft had to do M 2.4 while the USAF ones only did 2.2, swing wing wasn´t up to it and cost a fortune to beef up.

          Seriously though they have some different needs due to location and conditions and the Australia specific mods are to be expected.

          • Agreed that is a touch one.

            From what I u9dnerstadn the F-18s were completely stock as well.

            Same with the M-1 Tank purchase to replace the Leopards.

            Not sure why some like the N-90 got so far off track or why the Apache was not purchased.

            I admire the realization that push come to shove it will be with US forces they need to operate with.

            Funny world, good allies without a question.

          • “Funny world, good allies without a question.”

            Indeed.Outside the UK they are the only country I would have trusted with the F-22 had it been exported.

          • I doubt if they would have asked. Perception at the time of the F-35 buy in was that Australia wouldn´t have to deal with air surperiority issues so a multi role aircraft was what was needed, more bang for the dollar. Same logic dictated F-18 over F-15.

            I don´t think the same applies now. I would expect that they will be watching closely Japanese and Korean air superiority designs and their progress, as it´s too late to ask about F-22s now.

          • I think that was the sad part, the F-22 was just getting up to speed production wise and while its reported to be finicky, when it works (and it only takes a couple) its a dynamite aircraft.

            note: Being in Alaska has some relevance due to the low temperatures. Big difference between being cold soaked on the ground vs warmed up and going to 40K plus. They are all sheltered now.

            I never did get Australia and the F-18 (which I think is a hell of an aircraft, more along the lines of what the Marines need for CAS though I think and A-10 is the perfect choice.)

            The F-111 was a great long distance bomber, P-38 in the days or yore in WWII being the equivalent of the F-15 (two engines and great range) to deal with those god awful long distance Pacific /.Indian Ocean flights and a good missile load at the fight. .

            F-15 and F-18 mix yes.

            F-22 would have been great and heartily agreed, GB, Japan and Australia would have been great and trusted places for that aircraft with the vision of how it works and needed.

          • I would never trust Japan with the F-22. There has been way too many security breaches with China and remember how Toshiba sold that milling technology to the Soviets that enabled their subs to make a generational leap in quietness.

            As for the F-22 it is interesting to note that the troubled F-35 already is cheaper to operate with a higher readiness.

            Great aircraft but it is a maintenance hog.

          • toshiba, soviets, subs and not thought through comments.

            Noise levels ( and propulsive efficiency ) are determined by (innovative) design of the propeller blades. This requires some deeper understanding of hydrodynamics.
            CNC milling machinery makes the instantiation of a product faster but not better.
            Looks like the US at the time had the machinery at hand but not the theoretical understanding.
            It is interesting to note that advances of US opponent invariably devolve to allegations of stealing, betrayal and other noncreative activities.

          • Geo: The F-35 can’t even fly a combat mission unescorted.

            Have you followed that they gun can’t hit what its aimed at?

            It has all of 2 seconds worth of ammo for a CAS aircraft!

            The software is not to the final combat load.

            It carries all of 2 missiles in stealth. As the odds are gong to be 20 to 1, the conversion goes like this.

            Ahh Fellers, this is Birdman, I shot off my two missiles, good news is I got two, there is only 28 left. the bad news is my gun can’t hit anything, I can’t maneuver anyway, its only got 2 seconds of ammo so even if I had a real fighter its pretty much useless.

            I have got return t to base, I will be back in 2 hours. If any of you are alive when I sneak back I will pot a couple more , that take it down to 26.

            If you are all gone, then I will sneak back out after I get my next two.

            If its going to be a force multiplier it needs at least 6 missiles.

            If it carries those missiles externally its not better than an F-16 and cost a hell of a lot more.

            Its also touted as CAS, it can’t do both, certainly not effectively and we are paying 100 million plus for a CAS?

            Where the bad guys can SEE you.

          • Uwe: That was a company that did it, not the first time (P&QW also did that)

            As far as I know Japan defense forces have kept their military secret well under wraps.

            GB made a mistake with the goblin engine, good reason to have a cross council that vetoes stupid decisions.

          • re: Toshiba

            The Soviets had no machine capable of using the NC-2000 controller and that was most certianly needed to mill the blades to the shape and precise tolerances required. It simply wasn’t capable of doing that by hand. The Soviets did not have the equipment, which of course is why they bought it…

            http://digitalcommons.wcl.american.edu/cgi/viewcontent.cgi?article=1673&context=auilr

            http://articles.latimes.com/1987-09-10/business/fi-6976_1_toshiba-machine

            As for the US not having the theoritcal understanding why were their subs so much quiter than the Soviets?

            Not every tech theft scandal is a result of America not recognizing the creativity of others.

          • re:35

            Somebody better tell the Israelis they are getting a dog or all the other defense departments buying it.

            Why the Danes chose the F-35 (again)?.

            https://www.flightglobal.com/news/articles/analysis-why-denmark-is-holding-formation-with-f-35-425326/

            Yes the F-35 carries less ammo than fighters before but this is nothing new as technology advances. While the F-35 carries 1/20th of a second the F-16 carries a whopping 1/12th of a seconds of ammo. For modern dog fighting this is more than enough as the gun on aircraft is going the way of the gun on ships in it’s becoming a last ditch weapon. The last air to air gun kill by the US was in Vietnam.

            As for only carrying two missiles internally (regardless of the likely hood of the soviets or even China sending 20 fighters and we responding with 1 F-35) this sums it up best…

            If you take these two things together — sharing a sensor picture and cooperative targeting — it means that if you have a lot of F-35 aircraft up in the sky, each of those pilots has an enormous sphere of influence. They can see stuff hundreds of miles away, way beyond visual range, and shoot at it with missiles also from hundreds of miles away. Each pilot stops acting like a guy in a plane shooting at stuff and becomes a sort of air traffic controller of death, picking up targets way the hell off in the distance, directing missiles to and fro, and steering them into targets.

            This nifty trick becomes critical when you take into account the F-35’s stealth features. Stealth design comes at a cost. The biggest cost is that a truly stealthy aircraft has to carry all of its weapons, payload, fuel, and whatnot internally. Older planes just put all that non-stealthy stuff on pylons attached to the wings, but that sticks out on radar like a sore thumb and would ruin the plane’s stealth mojo. The problem is that carrying stuff internally means carrying much less.

            However, doing all this cooperative targeting jazz neatly avoids the problem by letting the stealthy aircraft remain stealthy, and getting all its missiles “shipped in” from aircraft that were never stealthy to begin with, and stayed well behind.”

            https://news.vice.com/article/what-does-the-f-35-mean

            The F-35 certainly can fly combat missions unescorted.

            “Shortcomings in the current version of the fighter’s software limit how many weapons it can carry and how many planes can share data during a mission…

            …Marine Corps officials say the aircraft could perform the full spectrum of missions, from close air support of ground troops to air-to-air duels, if it’s called into combat.

            Currently, “the F-35B’s sensor, self-defense, and stealth capabilities will be nearly identical to the 2017 fully combat configured F-35, making it capable in highly contested threat environments,” Major Paul Greenberg, a Marine Corps spokesman”

            http://news.nationalpost.com/news/better-five-years-late-than-never-u-s-marines-finally-ready-to-declare-f-35b-ready-for-limited-combat-duty

            Fact is every plane the air force has flown in the jet era has had teething problems (some more than others) and faced harsh criticism…

            “USAF’s Indispensable “Failures”
            The F-15, AWACS, and C-17 were derided as boondoggles early on. Things changed. ”

            http://www.airforcemag.com/MagazineArchive/Pages/2010/August%202010/0810failures.aspx

          • When it absolutely, positively needs to be gone overnight, “Tomahawk it”!

          • I believe that the Israelis have it understood what its good for.

            I believe its stealth will work and eventually its going to be a killer air fighter.

            Not because its any good in a dog fight and its acceleration pretty much sucks, simply because they can’t see it and its going to be an assassin.

            Israeli is also putting some of their own stuff into it.

            Only two missiles in steath is an issue, Israel may be planning on a support missile thrower (F-15)

            Said missile has to be able to be launched form a safe area and pass the direction F-35 and still have a range long enough to keep the F-35 out of dogfight range.

            And per the KC46 require and the F-35, I think Tehran is on the target list.

          • “And per the KC46 require and the F-35, I think Tehran is on the target list.”

            Objective is attack. … as you say.
            If it ever works satisfactorily it is a Ministry of War item and not defence.

      • I don’t see that we got to bid on the A400, Typhoon or Rafael projects. All of them get to participate in the F-35.

        No European defence OEM was ever invited and allowed to bid on the JSF (X-32 and X-35/F-35), the ATF (YF-22/F-22 and YF-23), the F117, the LWF (YF-16/F-16 and YF-17/F-18), the F-X (F-15), the VFX (F-14), the TFX (F-111), the LRS-B (B-21), the ATB (B-2), the B-1A/B-1B, the C-X (YC-14 and YC-15/C-17), CX-HLS (C-5A), the C-141, the C-130 and the P-3 and P-8 (etc.).

        Meanwhile, three European nations are operating the F-18 (i.e. Finland, Spain and Switzerland, and eight other European nations are operating the F-16 (i.e. Belgium, Denmark, Greece, the Netherlands, Norway, Poland, Portugal and Romania), while fifteen European nations are operating the C-130 (i.e. Austria, Belgium, Bulgaria, Denmark, France, Greece, Italy, the Netherlands, Norway, Poland, Portugal, Romania, Spain, Sweden and the UK),

        In contrast, the US military, apparently, is only operating one European designed military aircraft, the AV-8B Harrier II — an aircraft that was not even built in Europe.

        https://en.wikipedia.org/wiki/McDonnell_Douglas_AV-8B_Harrier_II

        Thus, any objective observer would probably conclude that the transatlantic defence trade remains grossly in favour of the United States, which long since seems to have been able to successfully “divide and conquer” the European defence market.

        Now, what would happen if, say, the EU were to implement a “Buy European” act, requiring at least a 50 percent made-in-the-EU-content on all defence related items originating in the US (i.e. a tit-for-tat response to the “Buy American” act)? Now that the UK is leaving the EU, a “buy European Act” might turn out to be significantly more plausible.

        Finally, as for your question on why no US defence company was allowed to bid on the A400, Typhoon or Rafael projects — with all due respect, but you seem to be ruefully unaware of the consequences of ITAR. The extraterritorial reach of US export control laws affects trade on both sides of the Atlantic — and specifically, US re-export regulations that control the movement of products containing components originating in the US, incorporated into a final product in one foreign country, and then exported to an export-controlled country (i.e. it’s the US government that determines which country is “export-controlled”).

        Apart for “industrial reasons”; why would France let the US have the final word on which nations they would be “allowed” to export the Rafale; why would Germany, Italy, Spain and the UK let the US have the final word on which nations they would be “allowed” to export the Eurofighter, and finally, why would the nations that have paid for the development of the A400M let the US have the final word on which nations they would be “allowed” to export the A400M?

          • I do remember that Britain gave Russia the genesis for their fighter jet engines that cost us so dearly in Korea.

          • @TW

            You could say Britain gave the jet engine to both main air war protagonists in that war. But of course the technology taken by the US quickly becomes ‘American’. Its provenance quickly forgotten.

          • I am less clear on who got what, I know the US got a great deal of tech transfer from GB in WWII.

            That was to be applauded. It was desperate times and a hard decision.

            What we did with it as well as if it would have come quickly I do not know.

            I do recognize that there was a great deal transferred though so don’t dismiss that with me at least.

            Frankly I think mixed content is by far the best way to go, keeps everyone form doing silly things (like US transfer of launch tech to China, not our brightest move)

          • Really the F-22 is nothing but a glorified ME-262. Everything the US has ever done after WW2 is due to stolen German technology.

          • Really? As I recall the US had the P-80 flying, Brits had an jet flying and both were about to enter combat.

            And just how did we steal it? As I recall history, we won that war.

            So, someone who looses a war (they started) killing something like 80 million people in the process let alone commits genocide and a massive scale not only against the Jewish population but Russian as well has intellectual property rights?

            Calling that statement foolish is being far to kind.

            And so the myth is not perpetrated.

            1. Swept wing design was in the arena by a number of countries not just Germany. At the speeds it operated at the ME-262 did not benefit from it, more German over engineering that in turn was wasted effort for no gain.

            2. The engines were poor and weak requiring two and the wing mounting that was a dead end for a jet fighter. the Gloster Meteor and the P-80 (using British engines) had a single engine and were much better not to mention actually lasted more than 10 hours.

            3. The swept wing design did not come into its own until higher speeds were achievable with more powerful engines.

            The aircraft that actually resembled the ME-26s the most is the 737-100.

          • P80:
            more dangerous to the pilots than to enemies.

            J33:
            The J33 was originally developed by General Electric as a follow-on to their work with the designs of Frank Whittle during World War II.
            https://en.wikipedia.org/wiki/Allison_J33#Development

            Swept wings ( and any other base for copy ):
            The primary value is in research results and developed theory that goes with those results.

      • “hardened requirements”? Some Kevlar around the cockpit.

        “Its taken Australia 5 years to get their A330MRT working fully […]”
        The point is they work fully today. What requirements would prevent an US KC-45 to refuel some US fighter like the Australian KC-30A are doing for some time now?

        The US AF was right at risk assessment. Low risk for Airbus but moderate risk for Boeing. Yes, Airbus had problems with the boom but Boeing has still problems with the boom. The KC-30A would have been a preproduction run for the KC-45.

        The offer by Boeing was lower but the risk related to the offer was never assessed as a penalty. Now the US taxpayer have to pay far longer for the maintenance of the ancient KC-135. The maintenance is performed by Boeing.

        • Well we saw Boeing have pre produc9ion run of the KC46 in the 767T supplied to Italy and Japoan . Didn’t work out so good.

          I now see Airbus is offering all sorts of possible enhancements to the A330MRT.

          You really don’t know what the spec were and if Airbus could have met those.

          In the meantime I see KC135s in beautiful l condition flying through Anchorage all the time (yes up close and in person). Boeing is doing a heck of a job aren’t they!

          While long term needed, they are good and well taken care of with low hours and the KC46 is not as critical as the USAF seems to purport it to be.

          Time line wise they will show up in number in plenty of time.

          • The KC-767I or KC-767J are very different to the KC-46:
            – different airframe
            – different refueling equipment
            – different avionics
            – …
            KC-45 could have inherited from KC-30A:
            – airframe
            – refueling equipment
            – avionics

            Airbus did also met all specs. Otherwise the offer would have been rejected as not complying.

            Communality
            Many countries ordered the A330 because the national carrier also operated a fleet of A330. I am not aware of any 767-2C for a civil costumer.

            The future
            The KC-30A is based on an A330-200 with an MTOW of 233 t.
            Airbus can easily update to 242 t and even offer a more fuel efficient engine – a simple 767Max won’t happen. Australia ordered two conversion kits to switch former Qantas A330 into tankers.

        • ““hardened requirements”? Some Kevlar around the cockpit.”

          The USAF required triple redundancy and adequate separation of critical components (FBW wiring, fuel lines) that are way over and above commercial requirements. The initial KC-46 design did not meet USAF spec because the wiring bundles were too close together at key areas requiring a costly redesign. The A-3300MRTT is a COT solution.

          “Yes, Airbus had problems with the boom but Boeing has still problems with the boom.” That’s not true according to published accounts. Actually, Boeing and Airbus achieved wet hookup to a C-17 within a few weeks of each other even though the A330MRTT was ‘in service’ with the RAAF for several years.

          That financial argument about the KC-135 is unproven. When I tried to dive into the numbers using USAF reports a few years back, the numbers didn’t justify replacing the KC-135 (which is a problem that plagued the original KC-X tender in Congress). They don’t fly all that often and the air frames are remarkably low time for their age, and the TF-33 engines are reliable with cheap sources of spares. The main factor for pushing for KC-X procurement now instead of 20 years from now is that in 20 years there will not be an over-designed aluminum-winged (a USAF requirement) commercial airplane in production to use as a cost-saving starting point and developing a ‘new al wing’ will drive up costs dramatically.

          • Ahh, my kind of guy.

            You did miss that the KC-135R (ie not the older model in storage) have CFM engines! Low maint even in up ops tempi, fuel efficient

            If we can keep a B-52 flying we can’t keep a low use KC-135?

            The real issue is that the KC-135 pilots are out of current cockpit ops and can’t transition into commercial pilots when they quit.

            Ego the 787 cockpit on the KC46.

            All corrosion problem on the KD-135 are under control and a constant check and re-vamp as needed when they come through for maintenance.

            They are as good looking as anything flying these days.

            Now the DC-10 is a dog and should be replaced. The KC135s? No.

        • ““hardened requirements”? Some Kevlar around the cockpit.”

          The USAF required triple redundancy and adequate separation of critical components (FBW wiring, fuel lines) that are way over and above commercial requirements. The initial KC-46 design did not meet USAF spec because the wiring bundles were too close together at key areas requiring a costly redesign. The A-3300MRTT is a COT solution.

          “Yes, Airbus had problems with the boom but Boeing has still problems with the boom.” That’s not true according to published accounts. Actually, both were fully certified at about the same time. Boeing and Airbus tankers achieved wet hookup to a C-17 within a few weeks of each other even though the A330MRTT was ‘in service’ with the RAAF for several years.

          That financial argument about the KC-135 is unproven. When I tried to dive into the numbers using USAF reports a few years back, the numbers didn’t justify replacing the KC-135 (which is a problem that plagued the original KC-X tender in Congress). They don’t fly all that often and the air frames are remarkably low time for their age, and the TF-33 engines are reliable with cheap sources of spares. The main factor for pushing for KC-X procurement now instead of 20 years from now is that in 20 years there will not be an over-designed aluminum-winged (a USAF requirement) commercial airplane in production to use as a cost-saving starting point and developing a ‘new al wing’ will drive up costs dramatically.

          • Tried to edit my own post– that didn’t work. Sorry to gum up the comments. Hopefully, the redundant post will be removed.

            @MHalblaub

            “Airbus did also met all specs. Otherwise the offer would have been rejected as not complying.”

            They both submitted bids that met the specs, but that doesn’t mean that they had 100% compliant engineering plans. They had a promise to meet spec and a cost estimate to do it.

            “Many countries ordered the A330 because the national carrier also operated a fleet of A330. I am not aware of any 767-2C for a civil costumer.”

            That’s true, but you don’t need a national carrier when you have access to the USAF’s global logistics supply chain.

            The future:
            No one will be buying substantially updated tanker airplanes in the future because the market isn’t big enough in the tanker/large cargo military aircraft to justify a continual presence in the market. Airplanes that are in service, but out of production: KC-135, KC-10, C-5, C-17, C-160, A310MRTT.

            The KC-45 might have one more chance against the KC-46 or a KC-777 when the KC-10s are replaced; but budget won’t be big enough to justify a redesign.

        • ““hardened requirements”? Some Kevlar around the cockpit.”

          What about EM pulse hardening, separation and redundancy requirements? Ballistic protection was only one facet. Kevlar is a typical buzzword in addition to a material used for armor. A commonly quoted oversimplified solution to often dismissed ballistic protection problems. Try using Dyneema or Spectra in the future to appear more current.

          “What requirements would prevent an US KC-45 to refuel some US fighter like the Australian KC-30A are doing for some time now?”

          The requirement of existence.

          “Yes, Airbus had problems with the boom but Boeing has still problems with the boom.”

          Nope. Problem solved.
          https://twitter.com/BoeingDefense/status/798587328650420224

          “Now the US taxpayer have to pay far longer for the maintenance of the ancient KC-135.”

          Calling 5 months “far longer” is a tad hyperbolic in my humble opinion. At least it’s not 5 years.

      • When US products are good enough they bid and sell in Europe … many air forces in Europe are equipped with US fighters, tankers, bombers, reconnaissance etc.

        When US products are good enough they bid and sale also to commercial aviation … components , civil aircraft etc…

        All US products are not imune of production or design problems

        Open your eyes and brain Mr Transworld

        • My impression is that mil products mostly sell on bribes and work shares and less so on product superiority. ( German Starfigher affair, … currently ending in F35)
          Then look at Indian procurements in recent times : they seem to ricochet from side to side for want of even more pocket lining and a tiny bit of work share 🙂

          Mostly civil OEM supply (much?) less so ( again my impression).

          • Admiral Prune: (love the name)/Ewe

            US products sell overseas when there is no national project in the offing, then they will buy US.

            OV-99 brought up the C-130, Europe had nothing like it in the 50s when it came out. They Still do not. The A400 is someplace in between the C-130 and the C17.

            Europe needs Air Lift, only Britain bought C-17s in numbers, I think there is all of 3 in a transport pool.

            France turns the Rafael at huge expense into a carrier aircraft when the US offers the F-18.

            Europe come out with an unneeded Tiger (broken up and fragmented design) when the AH-64 more than fills that need (which Britain bought and is buying more of)

            On the other hand, the US bought the German mad 120 mm smoothbore when it proved far superior to the US 105 and the upcoming 120mm rifled tank gun.

            Ditto the lattes 155 is a British design. Much better because its lighter and just as or more reliable.

            What is needed is for the US to sit down with its allies, figure out what’s needed in the future and come up with a better system.

            F-16 sold because it was partly made in Europe allowing them do so politically. F-35 (better or rose) the same.

            And yes the F-104 was a disasters. It was no more CAS than I am the pope and only niche was high altitude interception for the US , it could not dog fight, it originally had downward ejection seat (you got to be kidding)

            And I do understand the US issue in procurement, we have done some real dogs. F-35 may be the worst (it will work venally, its the lack of missile capability that is its downside)

            The US has covered Europe while its fumbled along with its mucked up procurement system which they can do because we are there.

            The A400 is still having issues.

            You will note France just bought 4 more C-130s because they have a gap. Good to know if you don’t produce, you have an out.

  2. This is a bit silly. What tarrifs on A320 sales have ever been imposed? Organizations hire lobbyists to impact political decisions and legislation. Sure, legislators favor companies in their own state employing folks but sessions isn’t going to be a legislator any longer. If anything, Airbus and Boeing are both expanding their footprints (job type) in red states to the chagrin of blue labor groups and voters. The next quasi related issue trump/executive branch would deal with, plausibly, is either mom or nsa from Boeing.

    This sets up if anything, thus, to favor Boeing’s fight to long term marginalized iam751 with their next major product production decision. Airbus might be busy dealing with italexit, brexit, and perhaps next, what ms. Le pen wants to do.

    Blue state aerospace manufacturing likely will take a hit again over the next ten years, but it’s probably more attributable to blue state labor and tax policies than Jeff sessions or sen. Shelby. Boeing certainly has the lobbying and influence reach to convey and sell their story to red state senators too. I’m not too sure the same can be said for the unions.

    • @Tex: Boeing continues to harp on the prospect of seeing tariffs placed on Airbus. That’s what this is about.

      • Mostly wineing and dining the share economy, right?

        In that context the right thing to say.
        But not realistic.

        • I am still laughing at Boeing management being blue (blue blood reference ein like the rich?)

          First time I have seen someone strike out the entire game first time up at bat.

  3. Boeing isn’t just HQ’d in a blue state, it’s executive’s and apparently it’s board’s own political bent is blue. They have pandered to the left and it’s politicians for years, particularly on social causes. This is how they receive so little flak for being anti-labor, and not much on environmental issues.

    But making hay out of Sessions and Airbus is a little overwrought. Even IF that relationship is a threat to Boeing, it’s a small one. Not even close to how much of a threat to Boeing Boeing is to itself.

    • And McNenary being a leader in killing social security makes the board blue how?

      Union busting is blue?

      That is a total fallacy.

      • Thats right. Lockheed Martin and Northrop Grumman are both HQ in Virginia, does that make them ‘blue’ like that state.
        Chicago HQ is probably one of Boeings smallest locations as far as staff numbers go. Noticed the comment about the HQ being called the Boeing ‘Longacre’ which is of course the agriculture term for roadside grazing used by farmers.

        • @Duke: “Longacres” is the name of the horse racing track that once occupied the site.

      • Your mistake is believing that blue and red always denote politics. They really denote a power base. Boeing, the Business round-table, and the US Chamber always had the D’s and the neocons in their pockets.

        Boeing’s primary political speed-bump has always been the real conservative right (vs the phony establishment).

        • From an economics spending standpoint and public welfare? Military spending?

    • Session’s and Airbus’ co-mingled future is hard to define; but its not overwrought. Bush administration favoritism to Airbus brought us the (rebid and cancelled) KC-45, the (massive cost-overrun and eventually cancelled) VH-71, and the (not overseas deploy-able) UH-72 Lakota. I appreciate Scott making the connection even if its based mostly on speculative predictions.

      • all very strange reasoning.
        Tankers: whatever, last idea I would have is favoritism from the Bush administration. What we saw was “dispute over a child” and the fake mom winning : “rip it”.

        VH71: nice base chopper completely frankensteined on home turf.

        UH-72 ( bog standard EC 145 up”mil”ed and adapted for assembly in the US.) your issue?

  4. Tariffs would hit Boeings customer. They harp on USTR to act (a basically useless beaurocratic office with no practical power or impact in the world), but in no parallel universe are sanctions closer than about ten degrees of separation from happening to Airbus products, impacting how much AA pays for a given plane.

    The whole scene is put on to leverage decreased scrutiny of ones own launch incentives/aid, and to minimize what the other side gets.

    It’s akin to an airline complaining to its own union about what that union conceded to a competitor in negotiations. Basically, precatory discussions, or more succinctly, haggling.

  5. Excellent fwd planning from Airbus, puts Trump on the spot. The longer Airbus stays in Alabama the more US suppliers will seep into the Airbus supply chain.

    • Grubbie,

      your comment gives me the opportunity to address something from a post last week which Scott unfortunately had to close due to overheated, “political” non sequiturs.

      If the US government can veto Airbus from selling Airliners to specific countries due to the fact that more than 10% of the parts come from the USA, would this not, in fact, be a reason for Airbus to reduce the number of american suppliers or at the very least, encourage them to, if possible, seek alternative non US suppliers for such items?

      • It would, it has not been a significant issue in civilian sale till now.

        This is the first time I can remember that being an issue. \

        Grubbie: While its true more recognitions there already is a large content of US supplied equipment on all Airbus aircraft (used to be more when GE participated though the A320NEO alone is pretty good numbers)

        The reality is that its not been put before the public much.

    • Ok, we are so over that!

      Hopefully they cancel AF2 (1 only when flying) . We don’t need it.

      If they cannot maintain the one (actually two) they have then just get ahold of Kalitta Air who is still flying some of the old 747-200s and apparently at a profit.

      On the other hand, thinking about it, as DT has a size issue, if we could get an A380 assembly line in the US, then that plane would be right up his alley!

      • what about an Antonov An-225 Mriya or two and put the president in a container village on board 🙂

        Obvious one would have to relabel them like the soviet rocket engines. Hmm, Boeing 378 🙂

        • I love it. Win win as the PE says, we will all be rich with fantastic medial converge.

  6. Airbus got about 160 M$ in cash incentives to set up shop in Alabama

    http://www.wsfa.com/story/18960466/airbus-incentive-details-revealed

    The true nature of this is, as well as of the Boeing subsidy story, is not Boeing against Airbus, but rather of US states competing amongst themselves, with taxpayer money, to move investment and employment within the US.

    It’s a zero-sum corporate blackmail game.

    Politicians are being played, and are loving it.

    • I whole heartedly agree. Some clauses in the US Constitution could be invoked (or would have been sans a recent political change that will preclude that)

      I think its the citizens that are being played, Politicians have always been bought and sold.

      NFL does the same thing, citizens build stadiums for billionaires.
      Wow. I guess that’s how they get to be billionaires.

  7. Texas should pull those reverse carpetbaggers (originally from Seattle) out of Chicago to Dallas/Fort Worth. Oh, how about a nice, fat $250MM incentive package for BA to come on down. And, further, the move offers them the benefits of leaving crime-ridden, gun happy, Bears-lame, Chi-town, and the lovely graft-ridden State of Illinois, which will shortly have its hands in all hometown corporate pockets to bail out its corrupt state and Chi city governments, and the bankrupt state pension system!

    • @Montana: I moved from Chicago to Dallas to Seattle. Where do I fit in?

      • Scott, you’re always welcome to stop in Missoula and visit–while you’re on your way to Texas, of course, if this comes about!

  8. The US imports much more than it exports. Guess who is the largest exporting company ? I guess better have a good look on consequences first, before imposing import tariffs for product from Europe and Asia.

    If the US would impose tariffs on Airbus and US carriers cancel, those aircraft could be rerouted to China filling up cancelled Boeing sales.

    Who would be hit most?

    http://www.independent.co.uk/news/business/news/donald-trump-china-iphone-cars-cut-trade-war-threat-us-auto-industry-a7415846.html

    • “The US imports much more than it exports.” Subtract oil imports and the US trade imbalance is pretty mild.

      The US gets a windfall from oil being priced in dollars since all other countries have to engage in the US financial markets to obtain dollars (and pay transaction fees). That windfall is a quid quo pro for the US ensuring open sea lanes and (usually) promoting global stability through an overly large military.

      All trade wars will be bad for the US (and everyone else). If Trump picks the wrong trade war, oil will be priced in some other currency and it will be devastating to the US economy forever into the future.

      • “Subtract oil imports and the US trade imbalance is pretty mild.”

        Ah, yes, logic at its best.
        What about everybody else from the potpourri of “western” nations also importing their energy?

        Looked around: Energy trade balance is still negative but closing in on equality. Trade deficit is on a 10 month high averaging >$40b per month i..e ~$500b/a.

  9. Changing the subject slightly, is there any chance of Boeing and Airbus putting the current spat out to pasture?

    My understanding of the timeline is as follows:

    1. Boeing agreed to a subsidy regime that was relatively favorable to Airbus in exchange for a monopolistic merger with McDonnell Douglas. Airbus would continue as an irrelevant player in the market. Because it was the company was going to be irrelevant, the subsidies would also be unimportant.

    2. It didn’t turn out that way. Airbus achieved near-parity with the merged Boeing.

    3. Fast forward to the start of the new millennium. Boeing was developing the 787; Airbus the A380. When Airbus announced the development of the A350 as a new plane, Boeing said we are going to stop this. Their motivations were partly tactical; partly a deeply held conviction that Airbus were getting unfair advantage through subsidies.

    I think Boeing were genuinely shocked the WTO found against them to the same level as Airbus, maybe to a more egregious level.

    They hadn’t taken account of the nature of Repayable Launch Investment, the main form of Airbus subsidy. It’s essentially free insurance against failure. But because Airbus has generally been a very successful company, the subsidy hasn’t kicked in that much in practice.

    The other trend is that Airbus and Boeing have become more like each other. Airbus is more of a normal corporation now and less like a consortium; Boeing is more of an integrator now, plugging in assemblies from partner companies to an overall design, and less a manufacturer of airplanes using components. This gives Boeing lots of subsidy opportunities as it allocates work to different territories, not all of which are in the United States.

    As their tactic – stopping the A350 – failed, and as they don’t have any moral advantage either, isn’t it time for Boeing to move on?

    • “1. Boeing agreed to a subsidy regime that was relatively favorable to Airbus in exchange for a monopolistic merger with McDonnell Douglas. ”

      Let me correct the phrasing:
      Living in a world of tax gifts Boeing judged these _repayable_ , god forbid, moneys to be the ultimate entanglement for Airbus.

      They thought that they had contained the situation in a satisfactory way. Otherwise they would have gone for a more elevated response in “table leveling”.

      • Uwe: While its a bit subtle, reality is that all that took place before Boeing got in the corporate welfare trough.

        Now its spot on.

        • IMU they never got out of that wellness resort.

          Competitive bomber design was based on a large research gift.

          The -80 money was sunk as otherwise it would
          have been taken as undue “Kriegsgewinn”.

          Working off large government contracts placed Boeing in a “money flows until you have the hang of civil ariliners” role comparable to Airbus were EU governments arranged for the same.

          • We could continue:
            737 foisted on Boeing by Lufthansa. ( They even thought about selling the project.)
            747 based on a customer wish and some knowhow accumulated in a military project.
            757 767 (tried to) copy Airbus common cockpit concept.
            787 is an upteched A330 copy …

            Obviously there is some element of caricature in this enumeration.
            No problem, I guess as it complements the way the other side presents their points.

          • Me thinks you are about to stall out.

            You keep equating those defense projects to pork.

            Are you claiming there was not a legitimate defense needs for B-47, B-52 and the KC-135s?

            You seem to forget that companies like Lockheed, Douglas (DC-8) , Chance Vought, Republic, North American won contracts for aircraft (and indeed Convair who also built a 707 like competitor) and all built various aircraft for the military.

            As I recall there was a thing called the cold war (maybe you are too young to remember?)

            Berlin airlift? Invasion of South Korea? Hungry? Czechoslovakia (latter on)
            Cuban Missile Crisis?

            The Khrushchev (?) Doctrine about any communist country was part of the Soviet Union. that meant Cuba by definition.

            Again you are probably to young to remember, but Europe was in ruins from a war that should never have been allowed to occur and it was the US and a strong defense establishment that kept the Soviets at by until Europe could recover, sometime in the late 50s and early 60s.

            At that time they should have taken over their own defense backstopped by the US.

            Sadly Europe had become dependent and are to this day.

            So we had to bail them out again in the Yugoslavians fragmentation (where a European country surrendered and turned over the local population to slaughter) Kosovo and the Libya intervention.

          • As a small kid I got taught about the same view “on how things are”.
            Later I grew up a bit and started to look out for the real facts.
            A lot of corrective information was available even before the collapse of the SU. Really interesting things came to light after that. And they still do.

          • Anything you can list and from reliable sources?

            Happy to discuss but not if its from RT (or Brietberther on our side)

    • @FF

      Succinct timeline picking up the main points and motivations, and I agree with your touted conclusion

  10. @Both:

    While I agree on the general sweep of things, I do disagree on the Free Launch Aid.

    The insurance kicked in immediately as they could at no risk create aircraft. What would have happened if the A320 was the short range thing it could have been and was a bust? (ala Mecure)

    A300 probably FLA was not returned.

    Same as Boeing, they would have bailed them out to maintain the industry (and rightly so in my view)

    As far as I know, only the A320 is retuning money. Not sure on A330 (it all depends on the numbers which we have never seen) and certainly the A380 (financially as much a bust as the 787)

    A350 like the A3330 looks to be a success, but what are the terms?

    Once you get to understand the system its to Airbus benefit to over shoot numbers on the number of airframes that have to be made before there is a return started.

    • RLI is a subsidy – no doubt about it. Airbus wouldn’t have survived through the 1970’s and 80’s without it. It’s become less valuable to Airbus since, as the company has become more successful. The subsidy isn’t the loan amount, as Boeing implied. It’s the difference between a fixed rate loan and a commercial investment loan that is calculated on risk.

      • In an impartial view there is imho no subsidy at all.

        RLI is not a credit. It is invested capital with a return split into a guaranteed part ( return + fixed gains) and a risk part ( royalties for sales beyond initial expectations.)
        A credit would have had slightly higher interest and no risk aspect. ( which is the regular definition of “credit” where defaulting is an _unexpected_ loss )

        Financing before 1992 is completely out of scope as there existed no treaty prohibiting this.

        • Uwe, Uwe Ewe: Man you are better than that!

          To quote: “Once the agreed sales numbers are reached, the (so called) loan will be repaid in 17 years on royalties”

          I am not a lawyer and I can drive legally fly an A380 truck through that hole.

          As a Technician/engineer and not too bad a lawyer (gasp)”

          1. What are the agreed on numbers (please publish for A300, A320, A330, A340, A380, A350).
          At this point the judge has just thrown you out of court.

          item 1 is a show stopper. Where is the language that says what happens if the DO NOT meet those sale goals?
          No penalty? its not a loan, at best its insurance, at works if FLA.

          And I can go on. The document start with that Boeing benefits form its military programs, Duh!!!!!!~~!!

          Europe does not? That is as self serving a string of BS as I have to hear (and our Orange one has been pushing the limits_)

          Breitbirtherer News could have written that one.

          I will not disagree that Washington Sate and Alabama are doing illegal give aways and it sucks more than a 777 engien, but to present that document as the source of refuting FLA is simply silly.

          • I got so excited a lot of errors.

            “At worst is Free Launch Aid. “

          • Uwe:

            I am sorry if my mis- spelling was taken as derogatory.

            It was not intended.

            I make no apologies from the argument on FLA.

            OV-99 cited that document, neither one of you responded to the flaws in it.

            Who decide what conservative numbers are?

            A secrete committee of Airbus?

            And it does not say what happens if those numbers are NOT met.

            Shoot, I could drive the Titanic through that legal hole.

          • The relevant numbers seem to be much smaller than you think.

            Twice the amount paid back from all invested RLI moneys.
            Recent RLI are obviously “unanswered” yet.

            Looks like (re)active RLI is 3 for 1.
            i.e. 2 Euro profit from every Euro cycled through an investment tranche.

          • “OV-99 cited that document, neither one of you responded to the flaws in it.”

            @Trans World

            It’s getting a bit tiresome repeating facts.

            Please do read the relevant comments on the issue in this Leeham thread from 2013:

            A.)

            https://leehamnews.com/2013/10/11/odds-and-ends-ana-airbus-and-boeing-era-of-the-jumbo-jet-repo-wars/#comment-28066

            B.)

            https://leehamnews.com/2013/10/11/odds-and-ends-ana-airbus-and-boeing-era-of-the-jumbo-jet-repo-wars/#comment-28082

            SomeoneInToulouse
            October 14, 2013

            With regard to RLI, nearly everyone seems to be missing the point (even OV with all the long quotes didn’t highlight the important bit):

            The base RLI is ALWAYS paid back REGARDLESS OF SALES, BREAK-EVEN, ETC. (these just set the repayment timeline)

            On top that, the ADDITIONAL ROYALTY is paid per frame BEYOND the repayment point set by the projected sales target.

            In other words, sales target met = repayment on a per-frame basis; sales target not met = oops, big lump repayment of the shortfall by the OEM; sales target exceeded = governments reap a bonus per airframe!

            SomeoneInToulouse
            October 15, 2013

            “Direct support to be repaid within 17 years at a rate of return at least marginally above the cost of Government borrowing”

            From http://webarchive.nationalarchives.gov.uk/+/http://www.dti.gov.uk/aerospace/launch-investment.htm

            Astuteman on Airliners.net has tried to explain it multiple times, and backed it up with sources, so if you want to trawl the archives there you should find details.

        • “Financing before 1992 is completely out of scope as there existed no treaty prohibiting this.”

          Ahh – the fine print.

  11. Pingback: 3 Links I Love: European’s Fight the US, Airbus Politics and Alabama, Solari Boards Down Under | Cranky Flier

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