For nearly two decades, Boeing and Airbus have been involved in legal battles over claims of unfair tax subsidies. However, two weeks ago, the president of France, Emmanuel Macron, suggested to United States president Joe Biden that the two nations should seek a settlement to the conflict with the two aircraft manufacturers.
Twists and turns
The World Trade Organization has backed different sides at different times in the saga, which dates back to 2004. It issued orders for the US and the EU to offset advantages by levying tariffs on a total of $11.5 billion in goods. Subsequently, each party rolled back the tax subsidies in the middle of the conflict.
Now, the presidents of France and the US are opening up a dialog to settle the issues. CNBC reports that countries’ official readout of the call doesn’t explicitly mention the long-standing trade dispute. However, according to a person familiar with the discussion, Biden said that relevant teams would follow up.
Progress in this field has been met with a welcome response by officials and several stakeholders. The European Commission shared that its aim is to find solutions to its ongoing trade disputes, including the Airbus and Boeing situation.
Altogether, this potential settlement by Macron highlights how high of a priority it is for France and the EU to start relationships strongly with the new US administration.
Across the pond, there are also positive notions. The SVP of European affairs at the US Chamber of Commerce, Marjorie Chorlins, said that there there is practically nothing left to action apart from reach a deal. She noted that the previous administration made good progress in the effort to resolve the problems, but did not reach a final agreement.
A positive outlook
The decision to progress further with a settlement would be in the hands of the US Trade Representative. At the end of last year, this group announced tariffs on European Union products. Aircraft components from France and Germany fall under these higher tariffs. However, the confirmation hearing of a new nominee, Katherine Ta, is set to occur this month. This move could bring changes in the climate.
According to CBNC, a spokesperson for the US Trade Representative said the following:
“We know there is great interest in resolving the Boeing-Airbus dispute on both sides of the Atlantic, and USTR looks forward to working with our European allies to find an outcome that levels the playing field once Ambassador [Katherine] Tai is confirmed.”
Additionally, an Airbus spokesperson said the following in an email to Simple Flying:
“Airbus supports all necessary actions to create a level-playing field and continues to support the EU’s commitment to finding a negotiated settlement of this long-standing dispute to avoid lose-lose tariffs.”
Altogether, it is evident that officials within both the US and the EU are keen to resolve the issues. The aviation industry going through such a challenging time amid the pandemic. Subsequently, those in the industry are recognizing the value in opening up positive discussions. They will be hoping for further progress this year.
What are your thoughts about this report? Do you think that this is a good move for the industry? Let us know what you think in the comment section.