Even as US state and local government support for aerospace manufacturers becomes a factor in the EU-US subsidies battle, EADS is conducting a competition between US sites for a potential Airbus A330 aerial refuelling tanker assembly centre, with the financial incentives offered by the localities a key factor in the decision.
This apparent double standard illustrates the growing importance to US and foreign manufacturers alike of the sometimes surprisingly substantial incentives such as tax breaks, bond issues, infrastructure investments and training grants offered by state and local authorities.
Even though it is not yet certain there will be a US Air Force tanker competition, EADS North America's search for aKC-330 assembly site is looking like being a rerun of the 2003 contest to host final assembly of Boeing's 787.
The 787 final-assembly battle was won by Boeing's Everett, Washington plant, helped by a tax reduction for the state's commercial aircraft industry that has been valued at $3.2 billion over 20 years. The list of companies taking advantage of state and local incentives is still growing, and is not restricted to US firms, or to traditional aviation industry enclaves. New Mexico has been aggressively pursuing aircraft manufacturers, having successfully lured start-up Eclipse Aviation to Albuquerque in 2000 with a multi-million-dollar incentives package. In July last year New Mexico directly invested $10 million in the very light jet (VLJ) manufacturer.
But New Mexico also illustrates the pitfalls of pursuing startup companies. Last year the state agreed to invest $6.25 million in Aviation Technology Group (ATG) so it would build its VLJ in Albuquerque. The company accepted the deal, but then received attractive offers from Colorado and Utah and is now negotiating with all three. Another New Mexico community announced a deal with American Utilicraft to build the assembly plant for its feeder freighter, but later withdrew its investment.
The biggest blow to New Mexico's ambitions came last month, when the state dropped its bid for final assembly of Bombardier's planned CSeries airliner. New Mexico was the only US location left in the running, but withdrew citing delays in the decision and concerns its bid was being used as leverage in Bombardier's negotiations with the Canadian and Quebec governments and its unions.
There will be plenty of other opportunities. In the last two years, Texas has provided $35 million to Vought Aircraft Industries to consolidate its aerostructures plants; Jacksonville, Florida $11.3 million to secure final assembly of Embraer EMB-145s for the US Army Aerial Common Sensor programme; Columbus, Mississippi $2.6 million to help build a Eurocopter helicopter plant; and, in the biggest such deal to date, Charleston, South Carolina $560 million to land Vought/Alenia joint-venture Global Aeronautica's 787 fuselage assembly plant.
The Charleston plant will bring 645 jobs: the EADS tanker assembly line promises 1,100 jobs, but is totally dependent on USAF procurement plans. The chosen site will be anchored by an Airbus engineering centre that will open early next year and employ at least 100 people. Italy's Alenia, meanwhile is looking at US assembly of its C-27J transport if it is ordered by the US Army, with Charleston one option.
GRAHAM WARWICK/WASHINGTON DC
Source: Flight International