Thu, Jan 28, 2010
Big Two Opposed To "Favorable" Financing For Regional Jets
With the spectre of Bombardier CSeries jets eating into their
market share, Airbus and Boeing are working together to oppose the
Canadian government's proposal to finance the CSeries under rules
that currently exist for smaller aircraft. Aviation industry
financial leaders plan to meet next week to discuss
export-financing rules at the Organization for Economic Cooperation
and Development in Paris.
CSeries Artists Concept
The Wall Street Journal reports that the U.S. and European Union
dispute Canada's claim that the CSeries jets can be financed
through existing rules normally applied to smaller aircraft, but
not to jets built by Boeing and Airbus. The C-Series is widely seen
as a potential competitor to the Airbus A320 and Boeing 737
single-aisle airplanes.
The export rules covering regional jets guarantees that an
export-credit agency will repay a loan for an airplane should the
buyer default. Boeing and Airbus had no problems with different
rules for regional jets than longer-haul aircraft because they did
not see an overlap in the market. But they objected when the
Canadian government wanted to use the same favorable rules for the
CSeries, which will directly compete with their aircraft.
A U.S. Treasury spokeswoman said the goal of the OECD is to
formulate a single set of rules for all aircraft. Aircraft makers
from Russia, China, Japan, and Brazil are all also included in the
talks, as each either has aircraft already in the 100+ seat
category, or have plans for such airplanes. All could erode the
20-year, $6 trillion combined market currently anticipated by
Airbus and Boeing.
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