Air Transport

UK industry minister Margaret Hodge says it remains to be decided whether the UK government will continue to stump up one-fifth of the repayable launch aid traditionally provided for new Airbus programmes after BAE Systems withdraws as a 20% shareholder.

The transatlantic war of words over subsidies was reignited at ILA after the four “Airbus ministers” of France, Germany, Spain and the UK said they had agreed in principle to provide launch aid for the A350, which appears certain to cost significantly more to develop than originally budgeted. The ministers will meet at the Farnborough air show on 17 July to sign off the A350 support package. “We take the view, particularly with regard to the A350, that we should continue the path we have taken,” said German economics and labour secretary Georg Wilhelm Adamowitsch. Commenting on the WTO dispute, he said it was “still the objective to reach agreement outside the courts”.

US trade representative spokeswoman Neena Moorjani said: “The USA has made it clear for over two years now that launch aid for the A350 is unacceptable. Increasing the amount of launch aid already committed to the A350 only makes the problem worse. We will litigate our WTO case to completion if necessary.”

Hodge said the question of whether UK launch aid for the A350 would be set at 20% “depends on the issue”, while Airbus majority shareholder EADS’s chief financial officer Hans Peter Ring said the company could “think about alternative financing” for the A350 if Europe and the USA were both willing to make concessions.

Meanwhile, EADS co-chief executive Thomas Enders expressed surprise that the potential implications of the subsidies dispute were questioned by the US Air Force in its recent tankers request for information. “A lot of people wonder [at] how the USAF is trying to handle that matter,” said Enders. “We would be very interested to see how our competitor is going to answer that one as well.”