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Last Updated: Friday, 19 October 2007, 11:17 GMT 12:17 UK
Airbus boss calls for end to feud
KC-30 tanker
Airbus and Boeing are now battling it out over a US Airforce contract
The EU and the US should abandon a feud over aircraft subsidies because it is "bad for the industry", a senior Airbus official has said.

EU officials have complained to the World Trade Organization (WTO) that US aid to Boeing broke free trade rules.

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

But Allan McArtor, chairman of Airbus North America, said state aid was "part of the DNA" of the industry, and that a new trade pact should be agreed.

Row

Describing the dispute with Boeing as "a waste of time and resources", Mr McArtor said the two firms, along with US and EU trade officials should negotiate a settlement of the WTO complaints.

"Let's face it: if the WTO process plays out, we're going to end up negotiating something anyway," he added.

"Why not skip the national histrionics and the lawyer-enriching trials and hearings and go right to the negotiating."

However, Mr McArtor said such an outcome was unlikely, especially while the two sides are battling to win a $40bn contract to provide refuelling aircraft to the US Air Force.

He accused Boeing of using its WTO complaint about unfair EU subsidies as the "centrepiece of its PR campaign" to win the tanker contract.

Job fears

Unions in the US feel that the work should be given to Boeing so that jobs are not outsourced.

But Airbus parent company EADS has said the deal would lead to it building a new plant in Alabama to make the KC-30 tanker, creating thousands of skilled jobs in the US.

Its plane, based on the A330, is the result of a joint venture with US defence group Northrop Grumman.

Airbus tabled the KC-30 bid after a procurement scandal engulfed Boeing in 2003.

As a result of the scandal Boeing's then chief finance officer of its defence division - Mike Sears - was arrested and sacked.

The group's tanker contract was also ripped up - paving the way for the rival bid.

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