Airbus warns that if the US imposes tariffs on its aircraft and component imports, insecurity and disruption will result, not only to the aerospace industry, but the global economy as well.
Airbus made the comments following the decision of the World Trade Organisation (WTO) regarding the level of countermeasures it authorises the United States to impose on products from the European Union (EU).
“If the United States Trade Representative (USTR) chooses to imposes tariffs on the importation of aircraft and/or aircraft components, this will create insecurity and disruption not only to the aerospace industry, but also to the broader global economy. Yet it is still avoidable,” Airbus says.
Airbus CEO Guillaume Faury says: “Airbus will continue working with its US partners, customers and suppliers, to address all potential consequences of such tariffs that would be a barrier against free trade and would have a negative impact on not only the US airlines but also US jobs, suppliers, and air travelers.
“Airbus is therefore hopeful that the US and the EU will agree to find a negotiated solution before creating serious damage to the aviation industry as well as to trade relations and the global economy,”
In the coming months, the WTO will determine the amount of tariff countermeasures the EU can impose on US products – including imported Boeing aircraft – in the parallel counter case regarding illegal subsidies to Boeing. The WTO has already found that the US failed to address illegal subsidies causing harm to Airbus. This will provide the EU with grounds to claim countermeasures on US products at a level that could exceed US sanctions, according to Airbus.
If applied, these tariffs on both sides will severely impact US and EU industries, putting high costs on the acquisition of new aircraft for both US and EU airlines. Airbus notes aviation is a global industry, highlighting the fact that close to 40 per cent of Airbus’ aircraft-related procurement comes from US aerospace suppliers. This US supply chain supports 275,000 American jobs in 40 states through spending that has totaled USD 50 billion in the last three years alone. If tariffs are applied, the entire global industry will be harmed, Airbus reiterates.
The only way to prevent the negative effects of these tariff would be for the US and EU to find a resolution to this long-running dispute through a negotiated settlement, Airbus says. It adds that it continues to encourage the US Administration and the European Commission to find a settlement to this dispute, and thereby preserve the free, fair competition and open trade that have proven beneficial to the public and essential for a successful and growing global aviation industry.