Airbus presses for $2bn cut in WTO tariff award

Airbus is claiming that a World Trade Organization assessment of the airframer’s compliance measures should result in a $2 billion cut in the recent tariff award to US authorities.

The WTO had previously authorised $7.5 billion in tariffs against the European Union in October, in the long-running transatlantic dispute over aircraft subsidies.

European countermeasures, through a similar WTO complaint, have yet to be decided.

But Airbus says that a WTO panel has been assessing the measures the airframer has taken to comply with the trade organisation’s recommendations.

Airbus says the finding should “immediately” prompt a reduction of around $2 billion in the tariff award.

“This is the direct result of the panel finding that the loans for the development of the A380 no longer have an impact on Boeing sales and that therefore the value of the lost sales no longer exists,” it states.

It adds that the US Trade Representative should “accept the reality” regarding the removal of the A380 from Airbus’s sales line-up.

But Airbus also notes that the WTO found the measures to align A350 loan agreements with market conditions were “not sufficient”.

“Based on these findings, Airbus would support to appeal this report,” the airframer states.

Loans for the A380 and A350 remained a matter of concern to the WTO in a ruling in May last year, when its appellate body considered that – while a certain degree of compliance had been achieved – some adjustments to the loans were necessary to remedy the situation.

“Airbus remains committed to working with the EU and its member states to comply with the WTO recommendations,” says the airframer.

It accuses the US side of not having taken “visible action” to deal with its own illegal subsidies for aircraft programmes including the 777X, 787 and 737 Max.

Airbus is expecting a decision on EU countermeasures, which would impose similar tariffs on US products – including Boeing aircraft – in spring 2020.