Boeing's US aid 'hurting Airbus'

The Airbus A380 will enter service with Singapore Airlines next month

The European Union (EU) has claimed that US subsidies for American aircraft maker Boeing have cost Europe's Airbus $27bn (£13.4bn) in losses.

EU officials put forward that figure at the start of a World Trade Organization (WTO) hearing into Brussels' complaint that the US aid broke free trade rules.

The US has a parallel complaint to the WTO against EU help for Airbus.

Washington counters that Airbus has used billions of euros of European subsidies to boost its market share.

Dominant players

The parallel complaints to the WTO are being made by the US government and the EU respectively, as the WTO deals with inter-governmental disputes rather than those between companies.

Boeing is relying on a smoke screen of inflated numbers and broad brush accusations Geoff Shuman, Airbus

The EU's $27bn figure represents the losses it says the US aid for Boeing has caused Airbus in the past three years alone.

Washington in turn argues that Airbus has wrongly enjoyed subsidies of up to $205bn over the past decades.

The WTO is due to rule on the US complaint in December of this year, with a decision on the application from the EU in June 2008.

Boeing and Airbus dominate the market for medium to large-sized commercial passenger aircraft, which is worth an estimated $80bn a year.

'Cold facts'

"Boeing is relying on a smoke screen of inflated numbers and broad brush accusations," said Geoff Shuman, Airbus director of European affairs.

"We will produce the cold facts to demonstrate subsidy by subsidy how US subsidies have benefited Boeing and injured Airbus interests."

US Trade Representative spokeswoman Gretchen Hamel countered that the EU's claims were "to distract attention from its own massive subsidies".

Airbus and Boeing's global sales are now roughly equal, after Airbus' share fell back from 54% last year due to the highly-publicised difficulties surrounding its new A380 superjumbo.

Wiring problems caused the project to be delayed, but the A380 is now due to enter commercial service next month with Singapore Airlines.

Boeing has also seen delays to the release of its own new plane, the 787 Dreamliner.