How Boeing vs. Airbus Became Trump vs. Europe

Delta called them “an unfair tax on U.S. consumers and companies.” JetBlue, which flies only Airbus planes, said it was “concerned about the detrimental impact aircraft tariffs will have” and argued they would “harm customers who rely on us to offer competitive, low fares.”

Other major airlines in the United States did not comment on the tariffs, preferring to avoid publicly criticizing Mr. Trump, yet were quietly fuming.

The tariff package could have been worse for Europe and its customers. The Office of the United States Trade Representative said it planned to start by levying a 10 percent tariff on European aircraft and a 25 percent tariff on agricultural goods, including French wine and Spanish olive oil. Those taxes may be manageable for a time, but leave the United States room to increase pressure in the future.

[Read how these new tariffs could make your dinner more expensive.]

But no party got everything it wanted. Boeing had hoped the tariffs would tax airplane parts from Europe, a move that would have hurt Airbus, which opened a factory in Mobile, Ala., in 2015. In the end, the Trump administration declined to do so, believing that such a move might damage manufacturing in a pro-Trump state.

Airlines, meanwhile, had been lobbying for the tariffs to be structured in a way that minimized their pain. Last week, a bipartisan group of 34 lawmakers sent a letter urging Robert Lighthizer, the United States trade representative, to avoid levying tariffs and, if he did, to exempt existing aircraft orders. But the tariffs will hit existing orders.

With more rulings from the World Trade Organization and the threat of European tariffs targeting American products looming, Boeing may not have long to savor its success. Yet in the midst of a trying year for the company, the decision was a welcome bit of good news.

“The extent to which European member states went to create and sustain Airbus for the purpose of competing with Boeing, an iconic American company, is unprecedented,” said Robert Novick, a partner at the law firm WilmerHale who represented Boeing in the case. “Indeed, the W.T.O. established that, and the level of harm it found to Boeing is unprecedented.”

Source link

Spread the love

Leave a Reply

Your email address will not be published. Required fields are marked *