Joined: 24 Dec 2006
|Posted: Thu Jan 25, 2007 5:02 am Post subject: USA: Airbus drove Lockheed and McD D. out of business
|Details of WTO subsidies case show USA believes Airbus drove rivals Lockheed and McDonnell Douglas from commercial airliner market
By Aimée Turner
Details of WTO case over subsidies emerge, revealing allegations of sharp pricing practices and unfair competition
Airbus has been accused of driving US rivals Lockheed and McDonnell Douglas out of commercial aviation, as the first details emerge on the USA's case over unlawful aircraft subsidies.
In its submission to the World Trade Organisation, the US Trade Representative (USTR) charges Airbus with conducting a campaign of targeting market share at the expense of profitability, principally through sharp pricing practices. Part of the WTO's role is to arbitrate on and resolve transatlantic disputes between Europe and the USA.
In documents now publicly disclosed, the USA gives detailed examples of subsidies it claims Airbus received for infrastructure developments, research and development in addition to highly preferential financial support at state level. The USA says that the combined effect of this support has allowed Airbus an unfair competitive advantage on pricing.