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Airbus Getting Up To €3.5B Launch Aid For A350  
User currently offlineN1786b From United States of America, joined Sep 2005, 559 posts, RR: 17
Posted (5 years 2 months 2 weeks 5 days 10 hours ago) and read 6247 times:

Just hitting the wires now. Between €3 to 3.5B.

French, German and Spanish participation wrapped up, "uncertain" about the UK.

French and German aid will be 35% each with the UK at 20% and Spain at 10.

The deal will be wrapped up at the Paris air show .

The source (in French)

http://www.rtlinfo.be/rtl/news/artic...liards+deuros+daides+%C3%A0+Airbus

13 replies: All unread, jump to last
 
User currently offlineStitch From United States of America, joined Jul 2005, 30886 posts, RR: 87
Reply 1, posted (5 years 2 months 2 weeks 5 days 10 hours ago) and read 6184 times:
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Well they had the right under the 1992 agreement to do so, but since the US has unilaterally pulled out of that agreement, I expect it will become an issue for the US at the WTO trial.

I wonder if Airbus is doing this because they can't fund actual final development and initial production out of their cash flow? Or if they fear that the A400M will be canceled and they will need to give back the billions of Euro they have already been paid?

[Edited 2009-06-05 14:50:15]

User currently offlineIkramerica From United States of America, joined May 2005, 21507 posts, RR: 60
Reply 2, posted (5 years 2 months 2 weeks 5 days 8 hours ago) and read 6058 times:



Quoting Stitch (Reply 1):
I wonder if Airbus is doing this because they can't fund actual final development and initial production out of their cash flow?

It's because you just "get used to" having this available, at a lower cost. And you plan for it.

The USA is headed the same way under the current leadership. While I can personally think this is unfair, it's hard to act outraged as an American at this point, with the nationalization of car companies, banks, and soon, newspapers...



Of all the things to worry about... the Wookie has no pants.
User currently offlineStitch From United States of America, joined Jul 2005, 30886 posts, RR: 87
Reply 3, posted (5 years 2 months 2 weeks 5 days 8 hours ago) and read 6011 times:
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Quoting Ikramerica (Reply 2):
The USA is headed the same way under the current leadership. While I can personally think this is unfair, it's hard to act outraged as an American at this point, with the nationalization of car companies, banks, and soon, newspapers...

Very true.


User currently offlineZeke From Hong Kong, joined Dec 2006, 9007 posts, RR: 75
Reply 4, posted (5 years 2 months 2 weeks 5 days 7 hours ago) and read 5898 times:



Quoting Ikramerica (Reply 2):
It's because you just "get used to" having this available, at a lower cost.

Care to backup the "lower cost" claim ? You do realize how cheap money is at the moment, that is if you can get financing.

Why did the banks and car companies need to get government funding in the US ? It would be very hypocritical if the US went to the WTO over this.

With the A320 still dishing out nice royalties, it is hardly "cheap"!!!



We are addicted to our thoughts. We cannot change anything if we cannot change our thinking – Santosh Kalwar
User currently offlineOsiris30 From Barbados, joined Sep 2006, 3192 posts, RR: 25
Reply 5, posted (5 years 2 months 2 weeks 5 days 7 hours ago) and read 5865 times:



Quoting Zeke (Reply 4):
It would be very hypocritical if the US went to the WTO over this.

Hard to argue that. I personally suggest Boeing go and get about $7B from the US Government for the 787 and 748 and we'll just call it a day and carry on (I mean hell just about every other corporation is getting billions)



I don't care what you think of my opinion. It's my opinion, so have a nice day :)
User currently offlineZeke From Hong Kong, joined Dec 2006, 9007 posts, RR: 75
Reply 6, posted (5 years 2 months 2 weeks 5 days 7 hours ago) and read 5843 times:



Quoting Osiris30 (Reply 5):
I personally suggest Boeing go and get about $7B from the US Government for the 787 and 748 and we'll just call it a day and carry on (I mean hell just about every other corporation is getting billions)

I am sure they have have had enough fat NASA and DoD contracts that would make that number look small.

Not like NASA (and Boeing via NASA cotracts) did not get funding for the 777

http://www.nasa.gov/centers/langley/news/factsheets/Boeing777.html

How much have the US and Japanese govements thown into the 787 ?



We are addicted to our thoughts. We cannot change anything if we cannot change our thinking – Santosh Kalwar
User currently offlineOsiris30 From Barbados, joined Sep 2006, 3192 posts, RR: 25
Reply 7, posted (5 years 2 months 2 weeks 5 days 6 hours ago) and read 5796 times:



Quoting Zeke (Reply 6):
How much have the US and Japanese govements thown into the 787 ?

Zeke, please let's not get into government tax breaks, and infrastructure funding debates, because Airbus gets the same. Also let's not get into Nasa and the DOD lest I have to point at the 400M that by rights should be deader than a door nail right now. Let's just accept that everyone and their bloody brother (but me) seems to be getting government handouts these days.



I don't care what you think of my opinion. It's my opinion, so have a nice day :)
User currently offlineIkramerica From United States of America, joined May 2005, 21507 posts, RR: 60
Reply 8, posted (5 years 2 months 2 weeks 5 days 5 hours ago) and read 5731 times:



Quoting Zeke (Reply 4):
Care to backup the "lower cost" claim ? You do realize how cheap money is at the moment, that is if you can get financing.

Man, we've been over this.

The risk is lower when 1/3rd of your money comes from governments with lenient terms. That means the remaining money you borrow from elsewhere is easier to get because your project is seen as more secure, and because it is less of the total cost of the program.

In times of easy capital, the cost of capital is lower when 1/3 does not have to be raised from revenue streams or from a true market source.

In times like now, where capital is harder to find, the mere act of making it available from the government (be it the US or EU governments), "props up" the company and again, makes other capital easier to raise, because it's less risky. This is the theoretical excuse our government has used for giving money to failing banks and manufacturers who would rightfully have otherwise been taken over by healthier companies.

Debating whether it is fair or unfair, right or wrong for the EU to provide launch aid is one thing. But trying to claim that continued government funding doesn't fundamentally change the risk profile of Airbus's projects and thus lowers it's overall cost of capital is just not worth debating.



Of all the things to worry about... the Wookie has no pants.
User currently offlinePPVRA From Brazil, joined Nov 2004, 8957 posts, RR: 40
Reply 9, posted (5 years 2 months 2 weeks 5 days 5 hours ago) and read 5705 times:

This kind of thing needs to stop, from all parties involved. Just wait until China starts to massively subsidize their own domestic aircraft development and export. Forget Airbus, Boeing, Embraer, Bombardier. . . least we can do is set an example, rather than continue to dump fuel in the fire.


"If goods do not cross borders, soldiers will" - Frederic Bastiat
User currently offlineBriguy1974 From United States of America, joined Aug 2005, 133 posts, RR: 0
Reply 10, posted (5 years 2 months 2 weeks 5 days 4 hours ago) and read 5606 times:

Only 3.5 billion.....I thought it actually would be a bigger number. $$$$ is not cheap from anyone right now. I do not want this this to sound like you are all going to take it but you have to assume that EADs credit rating can not be that great. The A380 continues to drain money and without more orders is going to cost EADS 100's of millions???billions?
Is there checks and balances to make sure this money is used on the A350 program or does EADS use this money as it needs it across all programs?
The huge profits EADS makes on the A318/319/320/321 program. Does it go back to the countries or how does EADS divvy it all up?


User currently offlineOsiris30 From Barbados, joined Sep 2006, 3192 posts, RR: 25
Reply 11, posted (5 years 2 months 2 weeks 5 days 4 hours ago) and read 5587 times:



Quoting Briguy1974 (Reply 10):
Is there checks and balances to make sure this money is used on the A350 program or does EADS use this money as it needs it across all programs?
The huge profits EADS makes on the A318/319/320/321 program. Does it go back to the countries or how does EADS divvy it all up?

With due respect, please just search the forum history for this. This sort of information has been the source of about 8 million flame wars, a ton of mis-information and is likely to spark a holywar. I don't even want to link it, because talking about the specifics of 380 finances, 320 repayments and the rest of it is like walking into a biker bar and saying you just ran over all their bikes.. on purpose..



I don't care what you think of my opinion. It's my opinion, so have a nice day :)
User currently offlineNAV20 From Australia, joined Nov 2003, 9909 posts, RR: 36
Reply 12, posted (5 years 2 months 2 weeks 5 days 3 hours ago) and read 5563 times:



Quoting Osiris30 (Reply 11):
walking into a biker bar and saying you just ran over all their bikes.. on purpose..

Love it, Osiris30.  Smile

I agree with others that the 'launch aid' argument is over and done with, for years to come. The WTO can 'meet' all it likes, but governments worldwide will be pouring cash into all sorts of manufacturing companies for years to come.



"Once you have flown, you will walk the earth with your eyes turned skywards.." - Leonardo da Vinci
User currently offlineDiamond From United States of America, joined Apr 2004, 3279 posts, RR: 63
Reply 13, posted (5 years 2 months 2 weeks 5 days 3 hours ago) and read 5562 times:

This is one of those subjects that has been discussed to death - and even the new developments will lead to an old debate.

Thread locked.



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